St James’s Place: Britain’s biggest wealth manager has stock upgraded

City broker Peel Hunt has upgraded St James’s Place this morning, after a strong set of results and a surge in share price.

Britain’s biggest wealth manager reported £4.3bn in new money throughout 2024 this morning, sending its stock price up more than eight per cent to more than £10.

The bump came from £1.5bn of inflows in the last quarter of the year, which was 70 per cent ahead of consensus and St James’s Place’s strongest quarter in almost two years.

Peel Hunt analyst Stuart Duncan increased full-year cash flow forecasts for the firm by three per cent, and moved its target price from £8.90 to £10.35.

“SJP’s shares have continued to recover, yet still trade on multiples that are well below historic norms,” noted Duncan.

“Flows into investment products in the fourth quarter were also positive, reversing the trend in previous quarters,” he added.

St James’s Place’s stock price is up by more than 130 per cent over the last nine months.

While many of SJP’s competitors have reported similarly strong results, these were likely to “offer extra reassurance around the health of the asset gathering potential of the model following a rocky 18 months of newsflow,” said RBC analyst Ben Bathurst.

St James’s Place has faced significant criticism over its high charges, exit costs, and claims of non-transparent fee structure.

One key problem for savers attempting to understand whether St James’s Place has been providing value for money has been that the bundling of fees has left it impossible to compare its performance to other similar funds .

The firm’s preliminary results are due out on 27 February, where Bathurst said he would be looking for updates “on the ongoing advice provision and charge change implementation timetable”.

There were no changes to financial guidance on the issues from St James’s Place, with the trading update stating that the projects were progressing in line with plans.