On Dec 3, 2013, Zacks Investment Research upgraded
Artisan Partners Asset Management Inc.
) to a Zacks Rank #1 (Strong Buy).
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Rationale Behind the Upgrade
Artisan Partners has witnessed positive estimate revision
following the announcement of third-quarter 2013 results.
Further, the company's expected long-term earnings growth rate is
Artisan Partners reported third-quarter 2013 results on Oct 28.
The company's adjusted earnings per share of 67 cents beat the
Zacks Consensus Estimate by 4.7%. Better-than-expected results
were primarily driven by top-line growth, partially offset by
higher operating expenses.
While, total revenue was $178.0 million, up 9.9% sequentially,
operating expenses increased 9.6% to $124.6 million. Assets under
management were $96.9 billion as of Sep 30, 2013, up from $85.8
billion as of Jun 30, 2013.
Artisan Partners' capital deployment activities are also
encouraging. On Oct 22, the company announced a second quarterly
dividend of 43 cents since its initial public offering in Mar
2013. The dividend was paid on Nov 26 to Class A shareholders of
record as of Nov 11.
Moreover, in Oct 2013, the company announced public offering of
4.8 million shares of Class A common stock at $56.0 per share.
The company intends to utilize the proceeds of the offering to
buy convertible preferred stock and preferred units of Artisan
Partners Holdings LP (the company's subsidiary) from private
equity funds controlled by Hellman & Friedman LLC. Going
forward, this is expected to partly reduce Artisan Partners'
interest expenses and prevent further dilution of common stock.
During the last 30 days, the Zacks Consensus Estimate for 2013
rose 2.0% to $2.52 per share. Further, for 2014, the Zacks
Consensus Estimate increased 3.6% to $3.20 per share over the
same time period.
Other Stocks to Consider
Apart from Artisan Partners, other investment managers worth
Virtus Investment Partners, Inc.
Waddell & Reed Financial, Inc.
Affiliated Managers Group Inc.
). While Virtus Investment Partners and Waddell & Reed carry
the same Zacks Rank as Artisan Partners, Affiliated Managers
holds a Zacks Rank #2 (Buy).