GAIN Capital Upped to Strong Buy - Analyst Blog


On Aug 8, 2013, Zacks Investment Research upgraded GAIN Capital Holdings, Inc . ( GCAP ) to a Zacks Rank #1 (Strong Buy).

Why the Upgrade?

GAIN Capital has been witnessing rising earnings estimates on the back of strong second-quarter results. Moreover, the company has an expected long-term earnings growth rate of 15.00%.

On Aug 7, 2013, GAIN Capital reported second-quarter earnings of 44 cents per share, substantially surpassing the Zacks Consensus Estimate of 26 cents. It also surpassed the prior-quarter earnings of 11 cents.

Better-than-expected results were driven by top-line growth, partially offset by higher operating expenses.

GAIN Capital's net revenue came in at $73.0 million, up 59.7% from $45.7 in the prior-year quarter. However, total expenses increased 22.4% to $48.6 million.

GAIN Capital's EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) stood at $26.9 million, up substantially year over year. Moreover, EBITDA margin stood at 36.8% compared with 19.4% in the year-ago period.

Further, as of Jun 30, 2013, cash and cash equivalent stood at $60.0 million, up 63% from the previous-year quarter. Moreover, shareholders' equity stood at $179.0 million as of Jun 30, 2013, compared with $163.7 million as of Jun 30, 2012.

Additionally, in the reported quarter, GAIN Capital signed a definitive agreement to acquire Global Futures & Forex, LTD (GFT) -  a global provider of retail forex and derivatives trading.

Over the last 30 days, the Zacks Consensus Estimate for 2013 went up by 74.5% to 82 cents per share. Moreover, for 2014, the Zacks Consensus Estimate went up by 50.9% to 80 cents per share over the same time frame.

Other Stocks to Consider

Other stocks that are also worth considering in the same industry include TD Ameritrade Holding Corporation ( AMTD ) with a Zacks Rank #1 (Strong Buy) and BGC Partners, Inc . ( BGCP ) and E*TRADE Financial Corporation ( ETFC ) with a Zacks Rank #2 (Buy).

TD AMERITRADE (AMTD): Free Stock Analysis Report

BGC PARTNRS INC (BGCP): Free Stock Analysis Report

E TRADE FINL CP (ETFC): Free Stock Analysis Report

GAIN CAP HLDGS (GCAP): Free Stock Analysis Report

To read this article on click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: AMTD , BGCP , ETFC , GCAP

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