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On Friday, JPMorgan updated its financial model for St. James’s Place plc (STJ:LN) (OTC:STJPF), leading to a raised price target on the company’s shares. The new target is set at GBP13.10, up from the previous GBP12.05, while the firm maintains an Overweight rating on the stock.
The adjustment follows the incorporation of St. James’s Place’s first-quarter 2025 assets under management (AUM) and flow data. JPMorgan analysts noted the positive market performance in recent weeks, which contributed to the revision. The firm’s underlying cash earnings per share (EPS) estimates for 2025-2027 were increased by 8-12%, primarily due to around a 6% rise in funds under management (FUM) assumptions.
The increased FUM expectations are projected to result in a 4-6% uplift in Net Income, which is further magnified at the EPS level due to operating margins. JPMorgan highlights that this comes without making any changes to their cost estimates, thus supporting the higher price target of 1,310p.
St. James’s Place has been identified as a top conviction pick within JPMorgan’s coverage universe. The company’s notable net flow strength over the past 12 months suggests a robust trajectory for growth and market share capture in the UK wealth management market. Despite an anticipated sequential decline in EPS for 2025 and 2026 due to repricing, these expectations are already accounted for in the consensus.
Looking ahead, JPMorgan anticipates that investor focus will shift towards St. James’s Place’s long-term growth prospects. The firm projects a compound annual growth rate (CAGR) of 25% in EPS over the period from 2026 to 2030, which is expected to encourage a gradual re-rating of the stock.
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