Waddell & Reed Upped to Strong Buy - Analyst Blog


On Jan 9, 2014, Zacks Investment Research upgraded Waddell & Reed Financial, Inc. ( WDR ) to a Zacks Rank #1 (Strong Buy).

Why the Upgrade?

Waddell & Reed has been witnessing rising estimates following the announcement of hike in quarterly dividend and impressive third-quarter results. Moreover, this investment manager's earnings growth rate is expected to be 24.2% for 2013.

On Dec 19, 2013, Waddell & Reed increased the quarterly cash dividend on its Class A common stock by 21% from the prior payout to 34 cents. The dividend will be paid on Feb 3 to shareholders of record as of Jan 13.

Waddell & Reed's impressive capital deployment activities make it an attractive pick for yield-seeking investors. Even during the financial crisis, when many investment managers slashed or discontinued dividend payments, the company not only continued with its disbursement but managed to increase it as well.

Additionally, on Oct 29, 2013, Waddell & Reed declared third-quarter earnings of 80 cents per share, which beat the Zacks Consensus Estimate of 72 cents. Robust results were driven by top-line growth, partially offset by higher operating expenses.

Moreover, over the last 60 days, the Zacks Consensus Estimate for 2013 rose 1.4% to $2.84 per share. Similarly, for 2014, the Zacks Consensus Estimate increased 2.6% to $3.57 per share over the same time period.

Other Stocks to Consider

While we prefer Waddell & Reed, other finance stocks with a Zacks Rank #1 include Artisan Partners Asset Management Inc. ( APAM ), CIT Group Inc. ( CIT ) and BofI Holding, Inc. ( BOFI ).

ARTISAN PTNR AM (APAM): Free Stock Analysis Report

BOFI HLDG INC (BOFI): Free Stock Analysis Report

CIT GROUP (CIT): Free Stock Analysis Report

WADDELL&REED -A (WDR): Free Stock Analysis Report

To read this article on Zacks.com 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: APAM , BOFI , CIT , WDR



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