UPDATE: New reports indicate that two FTSE 250 shares, Man Group and Diploma, are poised to significantly outperform the index in 2024. With the FTSE 250 rising by 8.5% over the past year, investors are keenly eyeing these stocks for higher returns.
Man Group (LSE:EMG) has seen its stock price increase by only 3% over the past year, which raises questions about its potential. However, the company has achieved a record-breaking $213.9 billion in assets under management as of September 30, 2023, marking a substantial increase of $20.6 billion from the previous quarter. This surge suggests that management fees and earnings could rise sharply, potentially reflecting positively in quarterly earnings reports early next year.
Given its diverse range of investment strategies, Man Group is well-positioned to withstand market volatility, making it a compelling option for investors. With a price-to-earnings (P/E) ratio of 10.82, it remains below the FTSE 250 average, indicating room for growth without becoming overvalued.
Meanwhile, Diploma (LSE:DPLM) has outperformed the FTSE 250 consistently over the past one, two, and three years, boasting a 21% increase in stock price in the last year alone. The company’s strong earnings growth, driven by both organic growth and acquisitions, has been sustained for over a decade.
Diploma also provides significant exposure to North America, now accounting for approximately two-thirds of its revenue. With signs of a rebound in U.S. industrial activity, the company’s earnings could see accelerated growth compared to the UK-centric FTSE 250 average. However, its P/E ratio stands at 56, raising concerns about potential overvaluation and the impact of currency fluctuations on profits.
Both companies present unique opportunities for investors looking to outperform the broader index in 2024. As the market evolves, analysts suggest keeping a close watch on these stocks for their potential to deliver substantial returns.
Investors are advised to conduct thorough research and consider the inherent risks before making investment decisions. The landscape for FTSE 250 stocks could shift dramatically in the coming months, making timely investment choices crucial.
