Shares in Just Group (LSE: JUST) led the FTSE 250 fallers on Friday morning (7 March) with an early 15% dip, despite strong headline results for the year to December.

CEO David Richardson said: “We made a pledge three years ago to double profits over five years. We have significantly exceeded that target in just three years and created substantial shareholder value as a result.“

What’s not to like about that? Maybe it’s because the good news was hinted at in a 15 January update, boosting the share price. Perhaps investors are going on ‘buy the rumour, sell the news?’

“Shaping a brighter future”

The CEO added: “Our markets remain buoyant and we are confident in our ability to grow earnings at an attractive rate from this significantly higher level.”

The pensions insurance group saw a 34% rise in underlying operating profit to £504m. That includes a contribution from new business growth. But recurring profits, which can be a key sustainer of long-term income, played a part.

Adjusted profit before tax actually fell, to £482m from the previous year’s £520m. The bulk of that is deferred, which leaves IFRS profit before tax of just £113m (£172m a year ago). Am I seeing some reason behind the morning’s share sell-off?

A 15.3% return on equity (up from 13.5%) and tangible net asset value (NAV) per share of 254p (from 224p) both look impressive. On the previous day’s close, that implies a discount to NAV of 36%.

Five-year winner

Just lifted its 2024 dividend by 20% to 2.5p per share for a 1.5% yield. It’s not among the FTSE 250’s biggest, but it beat forecasts. Seeing the share price more than double over the past five years more than makes up for a low dividend in my books.

After such a steller performance, the stock must be highly valued, right? Well, that’s where Just Group adds another to the list of puzzle-building, in my mind.

Underlying earnings per share (EPS) of 36.3p indicate a trailing price-to-earnings (P/E) ratio of just 4.5. But on a reported basis, EPS came in at only 6.5p per share for a P/E of 25. That’s a huge difference, and it’s down to IFRS profit before tax being so low.

Forecasts had put EPS at 8.1p. So on a reported basis, this was a miss. For 2025, the analysts predict 7.7p per share, which is a fall from the 2024 expectations but a rise on Just’s actual reported 6.5p. How do these figures relate to adjusted earnings? My head hurts.

What should investors do?

I think results like these offer us a helpful lesson. Anyone considering buying should take care to understand all the adjustments. It doesn’t imply anything wrong, and IFRS sometimes doesn’t apply well to specific businesses. But varying accounting standards can mean it’s much harder to make like-for-like comparisons between stocks based on the same headline criteria.

My take on Just as an investment? Until I do some further research to clarify these confusions, I simply don’t know.