We issued an updated research report on
) on Jun 12, 2014. The company's better-than-expected first-quarter
results released on May 1 and consistent improvement in top line
seem impressive. However, we remain skeptical about the company's
high debt levels and rising expenses.
Invesco's first-quarter adjusted earnings per share not only
surpassed the Zacks Consensus Estimate but also increased 20.0%
year over year. Results benefited from revenue growth partially
offset by higher expenses.
Additionally, Invesco's steady top-line growth driven by
improvement in assets under management remains its major strength.
We believe that the company's diverse product portfolio and
alternative investment strategies will continue to support top-line
growth in the quarters to follow.
However, rising operating expenses remains a major concern for
Invesco. In spite of cost-cutting measures being initiated, the
impact is not expected to be felt any time soon as the company
continues to invest in franchise.
Over the last 60 days, the Zacks Consensus Estimate for 2014
increased 1.0% to $2.44 per share. However, for 2015, the Zacks
Consensus Estimate remained unchanged at $2.77 per share over the
same time period.
Hence, currently Invesco carries a Zacks Rank #3 (Hold).
Stocks That Warrant a Look
Some better-ranked investment mangers include
Cohen & Steers Inc.
Woori Finance Holdings Co., Ltd.
Ameriprise Financial, Inc.
). While Cohen & Steers and Woori Finance sport a Zacks Rank #1
(Strong Buy), Ameriprise carries a Zacks Rank #2 (Buy).
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