Waddell & Reed Upped to Strong Buy - Analyst Blog

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On Feb 6, Zacks Investment Research upgraded Waddell & Reed Financial, Inc. ( WDR ) to a Zacks Rank #1 (Strong Buy).

Rationale Behind the Upgrade

Waddell & Reed has been witnessing rising earnings estimates aided by strong fourth-quarter 2013 results. Moreover, this well-known investment manger has delivered positive earnings surprises in the trailing 4 quarters with an average beat of 7.4%. The long-term expected earnings growth rate for this stock is 20.2%.

Waddell & Reed reported its fourth-quarter results before the opening bell on Feb 2. Earnings per share of 92 cents outpaced the Zacks Consensus Estimate of 82 cents. The bottom line was also up 50.8% from 61 cents per share in the year-ago quarter.

Results primarily benefited from top-line growth driven by solid inflows across all the segments. As of Dec 31, 2013, assets under management (AUM) totaled $126.5 billion, up 31.3% from $96.4 billion as of Dec 31, 2012.

The Zacks Consensus Estimate for 2014 rose marginally to $3.63 per share over the last 7 days. For 2015, the Estimate rose 1.2% to $4.15 over the same time frame.

With alternate forms of investments gaining popularity, assets managers like Waddell & Reed will continue to reap benefits. Going forward, we expect an improvement in the top line to boost capital deployment activities.

Other Stocks to Consider

Apart from Waddell & Reed, other investment mangers worth considering include Fortress Investment Group LLC ( FIG ), Lazard Ltd. ( LAZ ) and Och-Ziff Capital Management Group LLC ( OZM ). All these stocks carry the same Zacks Rank as Waddell & Reed.



FORTRESS INVEST (FIG): Free Stock Analysis Report

LAZARD LTD (LAZ): Free Stock Analysis Report

OCH-ZIFF CAPTL (OZM): 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: FIG , LAZ , OZM , WDR

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