Man Group Shares (LON: EMG) Make New 52 Wk Low as Analyst Downgrades PT

Having retreated significantly from 52 week highs of 279.23p set back in April, Man Group share prices (LON: EMG) have hit new low's this morning at 203.80p. This brings the YTD performance of Man shares to a negative 10.86%, a significant performance delta on markets that have been green on the year.

Inadvertently adding fuel to bear's fire, a UBS downgrade on the stock from 290 to 225 marks a significant shift in expectations. The firm's rating on EMG also shifts down from ‘Buy' to ‘Neutral' as UBS cites recent performance issues with the company's flagship AHL funds as the primary reason for this adjustment.

The AHL funds, which are integral to Man Group's offering, have seen a considerable downturn in performance, currently sitting on average 4% below their high watermarks after suffering losses between 10-20% over the past five to six months. This decline has naturally elicited concern from investors and analysts alike, prompting UBS to reassess their position on the stock.

Further compounding the matter, UBS has also cast doubt on the future inflow of capital to Man Group, which is expected to be less certain in the coming period. This revised flow outlook has contributed to the belief that the stock's value will likely remain range-bound within the next six to twelve months.

Earnings projections for Man Group have likewise been revised by UBS, with estimates for earnings per share in the years 2025-26 reduced by 10-15%. The lowered projections are mainly due to anticipated weaker performance fees, stemming from the funds' recent subpar results.

Man Group faces a challenging period ahead, with the inconsistent performance of the AHL funds and the uncertainties surrounding future capital inflows being significant factors influencing these revised expectations.