On June 9, 2014, we issued an updated research report on
investment management firm -
Janus Capital Group, Inc.
). The company exhibits decent fundamentals amid a competitive
environment in the industry.
Plagued by an uncertain market environment, Janus Capital is facing
challenges in reducing its net outflows. Nevertheless, the
company's diversification strategy that focuses on product
innovation and multi-boutique approach has helped in lowering
overall net outflows. Net outflows decreased to $1.5 billion in
first-quarter 2014 from $3.9 billion in the prior-year quarter. We
remain optimistic about the efforts being taken by the company and
expect Janus Capital to experience overall net inflows in the near
Bolstered by a solid liquidity position, Janus Capital has enhanced
shareholder value from time to time. Recently, in Apr 2014, the
company's board of directors increased its regular quarterly cash
dividend by 14%. Notably, during first-quarter 2014, the company
repurchased shares worth $11.3 million and paid $13.4 million in
dividends to shareholders. We believe such shareholder friendly
initiatives will continue to boost investors' confidence.
Additionally, analysts' bullish stance on the stock was reflected
in the movement of the Zacks Consensus Estimate over the past 60
days. For 2014, the Zacks Consensus Estimate advanced 4.0% to 78
cents per share while it moved north by 8.5% to 89 cents for 2015.
Despite the positives, we remain cautious owing to several issues
faced by Janus Capital that pose a threat to the company's
financials. These include a volatile equity market, continuous
increase in negative performance fees and the prevailing stringent
Janus Capital currently carries a Zacks Rank #2 (Buy).
Stocks that Warrant a Look
Cohen & Steers Inc.
Woori Finance Holdings Co., Ltd.
Ameriprise Financial, Inc.
) are among the other top-ranked stocks in this space. Cohen &
Steers and Woori Finance sport a Zacks Rank #1 (Strong Buy), while
Ameriprise carries the same rank as Janus Capital.
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