On Mar 1, Zacks Investment Research upgraded
GAIN Capital Holdings, Inc.
) to a Zacks Rank #1 (Strong Buy).
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Why the Upgrade?
GAIN Capital has been witnessing rising earnings estimates on the
back of strong fourth-quarter 2013 results. The investment broker
has reported positive earnings surprises in 3 of the last 4
quarters with an earnings beat of 46%. Moreover, the long-term
expected earnings growth rate for this stock is 16%.
GAIN Capital reported fourth-quarter 2013 adjusted earnings on
Feb 27 with earnings per share of 13 cents easily beating the
Zacks Consensus Estimate of 7 cents by 85.71%. Moreover, earnings
compared favorably with the prior-year loss of 11 cents.
Better-than-expected results were driven by strong top-line
performance, which more than doubled on a year-over-year basis.
However, elevated expenses (up 96%) were a dampener.
GAIN Capital's EBITDA (Earnings before Interest, Taxes,
Depreciation and Amortization) stood at $13.7 million, up
substantially year over year. Moreover, EBITDA margin stood at
16% compared with negative 15% in the year-ago period.
Further, as of Dec 31, 2013, cash and cash equivalents came in at
$39.9 million, up 8.4% year over year. Moreover, shareholders'
equity stood at $234.3 million compared with $163.7 million as of
Dec 31, 2012.
Following fourth-quarter 2013 results, the Zacks Consensus
Estimate for 2014 moved up 6.4% to $1.00 per share, over the last
7 days. For 2015, the Zacks Consensus Estimate advanced 4.2% to
$1.24 per share over the same time period.
Other Stocks to Consider
Some other investment brokers worth considering include
Piper Jaffray Companies
LPL Financial Holdings Inc.
). All 3 companies carry a Zacks Rank #1.