Janus Henderson Group Plc (NYSE: JHG)

Sector: Financial Services Industry: Asset Management CIK: 0001274173
Market Cap 7.36 Bn
P/B 1.67
P/E 33.22
P/S 5.05
ROIC (Qtr) 10.09
Div Yield % 1.45
Rev 1y % (Qtr) 12.10
Total Debt (Qtr) 395.40 Mn
Debt/Equity (Qtr) 0.08
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About

Janus Henderson Group Plc, often recognized by its ticker symbol JHG, is a prominent player in the asset management industry, specializing in investment management across all major asset classes. The company boasts a rich history that traces back to 1934, and it has grown into a global business with approximately 2,200 employees worldwide and assets under management (AUM) of $334.9 billion as of December 31, 2023. The company's primary business activities revolve around investment management. Janus Henderson Group Plc operates in four main segments:...

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Investment thesis

Bull case

  • Strong operating cash flow of 644.10M provides robust 1.63x coverage of total debt 395.40M, indicating excellent debt servicing capability and financial flexibility.
  • Operating cash flow of 644.10M provides exceptional 25.46x coverage of interest expenses 25.30M, showing strong debt service capability.
  • Strong tangible asset base of 3.46B provides 8.76x coverage of total debt 395.40M, indicating robust asset backing and low credit risk.
  • Robust free cash flow of 634M exceeds capital expenditure of 10.10M by 62.77x, indicating strong organic growth funding capability.
  • Operating cash flow of 644.10M provides solid 0.82x coverage of current liabilities 784.30M, showing strong operational health.

Bear case

  • Operating cash flow of 644.10M barely covers its investment activities of (434.40M), with a coverage ratio of -1.48, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 644.10M provides thin coverage of dividend payments of (249.70M) with a -2.58 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Cash reserves of 1.04B provide limited coverage of acquisition spending of (115M), which is -9.05x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • Free cash flow of 634M represents just -2.08x of debt issuance (305.30M), suggesting concerning reliance on leverage rather than internal cash generation for growth.
  • Operating cash flow of 644.10M is outpaced by equity issuance of (292.50M) (-2.20 ratio), indicating concerning reliance on equity markets for funding operations.

Peer comparison

Companies in the Asset Management
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 BLK BlackRock, Inc. 199.59 Bn 85.40 21.98 15.04 Bn
2 BN BROOKFIELD Corp /ON/ 103.94 Bn 31.52 5.64 262.97 Bn
3 AMP Ameriprise Financial Inc 88.69 Bn 55.02 7.20 5.89 Bn
4 BX Blackstone Inc. 88.51 Bn 49.39 10.93 12.89 Bn
5 KKR KKR & Co. Inc. 55.86 Bn 28.33 13.23 53.12 Bn
6 STT State Street Corp 46.52 Bn 21.77 3.91 34.72 Bn
7 NTRS Northern Trust Corp 34.14 Bn 33.31 6.71 15.64 Bn
8 RJF Raymond James Financial Inc 32.89 Bn 37.63 4.14 5.10 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.93 0.94
EV to Cash from Ops. EV/CFO 21.76 41.10
EV to Debt EV to Debt 18.00 15.28
EV to EBIT EV/EBIT 22.69 23.47
EV to EBITDA EV/EBITDA 21.37 47.80
EV to Free Cash Flow [EV/FCF] EV/FCF 22.45 38.62
EV to Market Cap EV to Market Cap 0.97 7.81
EV to Revenue EV/Rev 4.88 27.38
Price to Book Value [P/B] P/B 1.67 2.34
Price to Earnings [P/E] P/E 33.22 11.81
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 2.14 4.66
Dividend Payout Ratio % Div Payout % (Qtr) 46.30 -5.56
Dividend per Basic Share Div per Share (Qtr) 1.58 1.73
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 38.87 49.83
Interest Coverage Int. cover (Qtr) 28.98 25.16
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -16.09 -35.10
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -30.83 15.43
Dividend Growth (1y) % Div 1y % (Qtr) 1.28 1.65
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 32.24 -90.82
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 17.82 35.24
EBIT Growth (1y) % EBIT 1y % (Qtr) 27.92 -22.13
EBT Growth (1y) % EBT 1y % (Qtr) 26.60 -163.05
EPS Growth (1y) % EPS 1y % (Qtr) 35.32 -20.61
FCF Growth (1y) % FCF 1y % (Qtr) 5.65 220.21
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 14.14 -53.96
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.35 0.22
Cash Payout Ratio Cash Payout (Qtr) 0.38 0.36
Cash Ratio Cash Ratio (Qtr) 1.33 0.38
Current Ratio Curr Ratio (Qtr) 4.02 0.86
Debt to Equity Ratio Debt/Equity (Qtr) 0.08 0.70
Interest Cover Ratio Int Coverage (Qtr) 28.98 25.16
Times Interest Earned Times Interest Earned (Qtr) 28.98 25.16
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 28.80 -114.76
EBIT Margin % EBIT Margin % (Qtr) 27.53 -127.24
EBT Margin % EBT Margin % (Qtr) 26.58 -150.97
Gross Margin % Gross Margin % (Qtr) 100.00 67.88
Net Profit Margin % Net Margin % (Qtr) 20.10 -148.68