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In 2025, the FTSE 250 rose 8.5%. By contrast, Jupiter Fund Management (LSE:JUP) rocketed 83% higher. That’s a significant outperformance over the space of a year. However, I don’t think the party’s over, with scope for another stellar year in 2026.
Here’s my detailed reasoning.
Generating interest
To understand why 2026 could be strong, we need to first appreciate why the company’s doing well right now. After years of net outflows in 2024, Jupiter began to see net positive flows into its funds in 2025, especially in the second and third quarters.
The latest update we had in October showed that assets under management (AUM) climbed to £50.4bn by September, an 11% annual increase. Part of this was driven by market performance and by renewed investor interest.
For those unfamiliar with flows and AUM, they’re key metrics Jupiter uses to highlight how well (or badly) the business is going. The more client money the fund managers receive (inflows), the higher their AUM becomes. Given that Jupiter charges fees and commissions for looking after the money, there’s a correlation between larger AUM and higher revenue.
Ultimately, this ties back to the share price, because higher revenue usually translates into higher profit, which then boosts earnings per share.
The year ahead
Despite the surge in share price, the price-to-earnings (P/E) ratio sits at 11.84. The FTSE 250 index average is 13.3. So it can still be considered undervalued relative to the rest of the index. From that angle, if the earnings per share stayed the same for 2026 but the stock jumped another 83%, it would push the P/E ratio to 21.54. Granted, it becomes more expensive, but with the FTSE 100 P/E ratio just above 18, it’s not crazy.
That also assumes no growth in the earnings per share. In reality, I’d expect to see much better financial performance this year, driven by assets gathered in 2025. So in reality, the stock could rally and still remain reasonably priced if the earnings increase.
The business should also begin to see benefits from the CCLA acquisition during the summer of 2025. CCLA mainly focused on targeting non-profit organisations. So Jupiter’s gained a valuable new book of clients here, helping to both expand and diversify its overall base. I imagine there’s a host of synergies and economies of scale that can be eeked out from this deal over the coming quarters.
As far as risks go, I think the funds’ performance is a concern. If the managers have a bad few quarters, or if investors decide to rotate their money out of active management and into passive index funds, Jupiter could see AUM fall.
Yet despite this, I think the stock’s well placed to beat the FTSE 250 index again in 2026 and therefore could be considered by investors.
