JPMorgan American Investment Trust reports positive but lagging performance

(Sharecast News) - JPMorgan American Investment Trust reported a positive but lagging performance in 2025 on Wednesday, as its quality-focused investment approach underperformed a market driven by higher-risk stocks, while the board struck an optimistic tone on the outlook for US equities. The FTSE 250 trust delivered a net asset value (NAV) total return of 4.6% in sterling terms for the year ended 31 December, compared with a 9.6% return from its S&P 500 benchmark. Share price total return was 0.5%.

It said its relative underperformance reflected the portfolio's bias towards higher-quality, more reasonably valued stocks, which lagged a market led by lower-quality, high-beta names.

Currency movements also weighed, with the US dollar falling 6.9% against sterling over the period.

Despite the weaker one-year performance, longer-term returns remained ahead of the benchmark.

Over three years, the trust delivered a NAV total return of 70.3% versus 65.4% for the index, while five-year returns stood at 99.2% against 97.2%.

Since a shift in investment approach in June 2019, the trust has outperformed by 17.2 percentage points, generating a cumulative NAV return of 173.4% compared with 156.2% for the benchmark.

Chairman Robert Talbut said markets had demonstrated resilience despite geopolitical and macroeconomic uncertainty.

"Despite last year's uncertainties, US equity indices showed their continued resilience and closed the year at record highs, demonstrating again the robustness of US businesses," he said, adding that "this resilience gives good cause for optimism about the prospects for US companies, and the market, over the coming year and beyond."

The portfolio managers also highlighted the strength of US equities despite volatility, noting that "2025 can be characterised by the remarkable resilience of US equities in the face of significant market volatility," and adding that "our research analysts anticipate strong earnings growth for the S&P 500 ... these positive forecasts reinforce our confidence in the market's potential."

The trust maintained a high-conviction portfolio, with 94.3% of assets invested in US large-cap stocks across around 40 holdings, complemented by a small-cap allocation of roughly 5.7%.

Growth stocks accounted for 55% of the portfolio and value stocks 45% at the year-end.

The company continued to actively manage its discount, issuing 1.4 million shares at a small premium and buying back 10.9 million shares at an average discount of 3.4%, enhancing NAV per share.

Since the year-end, a further 2.8 million shares had been repurchased, with the discount standing at 4.5% as at 30 March.

Costs remained low, with an ongoing charges ratio of 0.34%, down from 0.35% a year earlier, and assets above £1bn charged at 0.25%.

The board proposed a final dividend of 8.75p per share, bringing the total payout for the year to 11.5p, up 4.5% from 11.0p in 2024.

It said the final dividend would be subject to shareholder approval at the annual general meeting on 14 May and, if approved, would be paid on 29 May to shareholders on the register at 17 April, with an ex-dividend date of 16 April.

At 0920 BST, shares in JPMorgan American Investment Trust were up 1.5% at 1,084p.

Reporting by Josh White for Sharecast.com.

See latest RNS on Investegate