Tags: Janus | JNS | brokerages | stocks

Janus Capital Thrives Amid Market Chaos

By    |   Monday, 12 Sep 2011 10:50 AM

Investment houses like Janus Capital Group (JNS) have seen their ups and downs lately. Stocks have taken a beating while demand for Treasuries and bonds have soared.

For Janus, however, overall business is growing. The company reported $41.9 million in net income for the second quarter, up 39 percent from the same quarter in 2010. Average assets under management for the quarter came to $171.6 billion compared with $160.2 billion during the same quarter a year earlier.

Quarterly revenues rose 6 percent to $264 million led mainly by gains in investment management fees, which rose 9 percent to $226 million.
The fate of the company's upcoming profits, however, is up in the air. Ratings agency Moody's has assigned the company a negative outlook, expressing concern about exposure to stock-market volatility.

"While Janus' financial metrics continue to improve including significant debt retirement from peak levels in 2007, weak organic flows coupled with recent underperformance present credit challenges," Moody's analysts write in a report.
"Recent underperformance in key equity strategies may impact distribution going forward given the firm's dependence on intermediary platforms," the analysts add.

Hitting bottom

Wall Street banks recognize the impact of market volatility on company earnings. In April, Barclays Capital reiterated the stock at overweight while in January, Sifel Nicolaus downgraded the stock to hold from buy. Deutsche Bank reiterated a hold recommendation in January while FBR reiterated a market perform recommendation.

Some, however, see the company due for a rebound. After all, the company's stock is trading between $6 and $7 a share these days. Jefferies Capital Group in late August initiated coverage with a buy rating.

Susquehanna, a financial institution, says an analysis of Janus Capital indicate shares are undervalued under several scenarios. "In a bull case scenario a potential asset manger could pay $18 per share for Janus, a financial buyer could pay $10.50 to $11.50 per share, and in a bear case shares are worth $10 to $11 per share," Susquehanna reports.

Janus next reports around Oct. 20.

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Investment houses like Janus Capital Group (JNS) have seen their ups and downs lately. Stocks have taken a beating while demand for Treasuries and bonds have soared. For Janus, however, overall business is growing. The company reported $41.9 million in net income for the...
Janus,JNS,brokerages,stocks
333
2011-50-12
Monday, 12 Sep 2011 10:50 AM
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