Asset manager St James’s Place (LSE: STJ) has proved to be one of the FTSE 100’s best performers during the past four weeks.
Since the mid-point of April the business has seen its share price detonate 11%, St James’s Place striking fresh record peaks just today. And I reckon the stage is set for the stock to keep on charging.
Funds favourite
Appetite for the company was done no harm by latest trading numbers released in late April.
The London business announced that gross inflows jumped 32% during January-March, to £3.23bn from £2.45bn a year earlier. And group funds under administration clocked in at £79.84bn versus £62.02bn previously, thanks also to the manager’s exceptional customer fund retention rate (this clocked in at 95% during quarter one).
Net inflows in the first quarter rose to £1.99bn, with inflows of £1.02bn across its pensions suite accounting for the lion’s share. And the company sees plenty of scope for its financial products to keep surging.
Indeed, chief executive David Bellamy commented that while “political and macro uncertainties persist, the more immediate concern for many people relates to personal financial matters, particularly in relation to long-term savings, protecting and preserving wealth, tax and intergenerational planning.”
In this environment the City expects earnings to continue surging for some time yet. Growth of 97% and 20% is forecast for 2017 and 2018 respectively.
And while a forward P/E ratio of 27.8 times may look a tad heady on paper, a PEG reading of 0.3 actually suggests the stock is priced attractively relative to its projected earnings performance. I reckon St James’s Place is a stock worthy of serious consideration from value-geared growth seekers.
Oxford don
Although impressive, the recent share price gains over at St James’s Place pale into insignificance compared with those of Oxford Instruments (LSE: OXIG), however.
The FTSE 250 business has jumped 29% in value during the past month, the engineer leaping after news it had shorn off its Industrial Analysis business to Hitachi High-Technologies for £80m. The move marks the latest step in massive restructuring at Oxford Instruments and, pending regulatory approval, is expected to complete during the second fiscal quarter.
The scientific tool builder had also reassured investors earlier in April with news that “trading in the second half of the year was consistent with the expectations disclosed in our interim results,” with strength at its NanoTechnology Tools arm offsetting difficulties at OI Healthcare.
And I believe Oxford Instruments can look forward to sales picking up further out as research spending across the globe steadily improves. The business saw its order book climb a healthy 5.1% at constant currencies between April and September, to £162.2m. And its vast global footprint puts it in the box seat to exploit this phenomenon to its fullest (the firm has manufacturing bases across the US, Asia and Europe).
The number crunchers expect earnings to rev to 12% in the year to March 2018 from an anticipated 1% advance in fiscal 2017. And a further 7% rise is predicted for next year.
I reckon a prospective P/E ratio of 19.6 times is very decent value for a stock of Oxford Instruments’ calibre, and reckon the share price should keep charging as trading conditions improve.
