Polar Capital Holdings (LSE: POLR) slipped back in Monday business following the release of half-year numbers, though a 2% decline is not indicative of a shocking statement.
Indeed, the London company’s results were pretty impressive. Assets under management (AUM) as of September marched to £10.6bn, a £1.3bn improvement from six months earlier. Polar Capital said that this was thanks to “net fund inflows of £820m together with market uplift and fund performance of £510m.”
Pre-tax profit climbed to £11.8m in the six months to September, up from £8.5m a year earlier. And the sunny result prompted an upgrade in the interim dividend to 6p per share from 5.5p in fiscal 2017.
Celebrating the results, chief executive Gavin Rochussen said: “Fund performance has improved and it is pleasing to report that, in the nine months to 30 September 2017, performance across our fund range has been largely ahead of respective fund benchmarks.”
And Polar Capital has continued to rake in business, Rochussen commenting: “The outlook… for the remainder of the financial year is encouraging with continued momentum in flows and fund performance in the months following the reporting period.” Assets under management improved to £11.4m as of the end of November.
Today’s results underline why City analysts expect Polar Capital to deliver brilliant earnings growth in the immediate term and later.
For the 12 months to March 2018, the business is expected to record a 45% earnings improvement, and in fiscal 2019 it is anticipated to report a 13% increase.
And with earnings expected to rise this year for the first time in several years, Polar Capital is predicted to get dividends marching skywards again (it has held the full-year payment at 25p per share since 2014).
This year the number crunchers are expecting a 26p reward, and next year a 28.1p dividend is expected. And as a consequence, the AIM company boasts enormous yields of 5.5% and 5.9% for fiscal 2018 and 2019 respectively.
With assets steadily rising thanks to a positive trading backdrop and Polar Capital’s ever-expanding range of products, I reckon the share is a great pick for both growth and income chasers, and particularly given its ultra-cheap forward P/E ratio of 15.3 times and a corresponding PEG reading of 0.3.
Supported by City expectations of an 18% earning rise in 2017, the FTSE 250 giant is expected to pay a 30.2p per share dividend, resulting in a 4.9% yield.
And with a further 9% earnings advance pencilled in for next year, Jupiter is predicted to lift the dividend to 32.4p, nudging the yield to 5.3%.
To complete the set, just like Polar Capital, I believe that Jupiter is also a steal at current prices. Of course a prospective P/E multiple of 17.7 times is hardly compelling, but a corresponding PEG readout at the bargain watermark of 1 certainly is.
And I am confident the financial giant has what it takes to deliver excellent long-term shareholder returns. AUM at Jupiter sprang to £48.4bn as of September from £46.9bn just three months earlier, thanks in no small part to its broadening product suite and the vast investment it is making across its operations.
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Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has recommended Polar Capital Holdings. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.