Schroders' Robust 2020 Results: Close to Offering Value to Investors

Narrow-moat Schroders reported net attributable profits of GBP 486 million for its 2020 fiscal year, this is slightly lower than the GBP 496 million it reported a year earlier, but also 3% ahead of the GBP 472 million we anticipated. We do not expect to make wholesale changes to our model and we maintain our GBX 4,100/share fair value estimate and our narrow moat rating. Schroders remains in 3-star territory but its share price has pulled back slightly recently and at 0.85 times our fair value estimate it is not far from moving into 4-star territory. Schroders declared a GBX 114/share dividend for 2020; this translates into a 3.3% yield at Schroders' current valuation, which should be attractive for dividend-focused investors.