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Here's Why Janus Henderson Group Shot 11% Higher on Thursday

By Eric Volkman - Apr 30, 2020 at 6:55PM

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Investors liked the combination of estimates-beating quarterly results, and ETF management fee cuts.

What happened

On Thursday, Janus Henderson Group (JHG 2.73%) not only unveiled first quarter of fiscal 2020 results that topped expectations, it also announced fee reductions in its exchange-traded funds (ETFs). Investors subsequently bid the asset management company's shares up by more than 11% on the day.

Stacks of coins in front of a stock chart.

Image source: Getty Images.

So what

Janus Henderson beat on both the top and bottom lines for the quarter. Revenue rose by almost 7% year over year to just under $555 million. Non-GAAP (adjusted) net profit inched 2.5% higher to $112.7 million, or $0.60 per share. The company also maintained its $0.36 per share quarterly dividend; that payout yields slightly more than 8%.

On average, analysts had been modeling nearly $527 million on the top line, with adjusted net profit of $0.53 per share.

That growth in fundamentals, apparently, provides scope for a set of prospectus management fee haircuts. Effective Friday, each of the five ETFs the company manages will get slightly cheaper for clients. Four will have this fee reduced from the current 0.35% to 0.30%, while the fifth -- Janus Henderson Short Duration Income ETF -- will drop from 0.32% to 0.26%.

Now what

The SARS-CoV-2 coronavirus outbreak widened significantly during Janus Henderson's first quarter, and judging by its results the company is holding up well. Those fee cuts should attract notice from those who favor ETFs, a durably popular fund category.

It'll be worthwhile for investors to follow how much more business the company attracts with these discounts, and whether they're helping or hurting revenue. 


Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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Janus Henderson Group plc Stock Quote
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