Piper Jaffray Hits New 52-Week High on Solid Y/Y AUM Growth - Analyst Blog

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Shares of Piper Jaffray Companies ( PJC ) achieved a new 52-week high of $56.26 in the first half of the trading session on Aug 25. The stock closed the session at $55.53, reflecting a year-to-date return of 41.3%. The trading volume for the session was 147,044 shares.

Despite the strong price appreciation, this Zacks Rank #1 (Strong Buy) stock has plenty of upside left, given the upward estimate revisions it witnessed over the last 60 days.

Growth Drivers

Strong second-quarter 2014 results as well as renewal of the share buyback plan were the primary growth drivers. Notably, the company reported 23.5% year-over-year growth in assets under management (AUM).

On Jul 31, Piper Jaffray announced a new share repurchase plan of $100 million - starting from Oct 1, 2014 and ending on Sep 30, 2016. This plan will reinstate the existing $100 million repurchase program that expires on Sep 30, 2014. The company had 16.3 million shares remaining under the existing plan as of Jul 18, 2014.

Moreover, reported on Jul 24, Piper Jaffray's second-quarter adjusted earnings came in substantially higher at $1.25 per share from the prior-year quarter figure of 32 cents. Though, the figure came in line with the Zacks Consensus Estimate, the overall results benefited from the 63.4% year-over-year surge in adjusted net revenues, partly offset by higher expenses.

Piper Jaffray is well poised for organic as well as inorganic growth, given its strong AUM and robust capital base. Though litigation costs are leading to increased expenses for Piper Jaffray, the company looks forward to enhanced growth triggered by impressive performance in the Asset Management and Investment Banking businesses.

Estimate Revisions Show Strength

Over the last 60 days, the Zacks Consensus Estimate for 2014 witnessed a 15% upward revision to $4.13 per share. For 2015, the Zacks Consensus Estimate rose 7.1% to $3.90 per share over the same time frame.

Other finance stocks worth considering include Arlington Asset Investment Corp. ( AI ), Moelis & Company ( MC ) and RCS Capital Corporation ( RCAP ). All these hold the same Zacks Rank as Piper Jaffray.


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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: MC , PJC , AI , RCAP

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As of 12/26/2014, 03:59 PM


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