On Feb 6, Zacks Investment Research upgraded
Waddell & Reed Financial, Inc.
) to a Zacks Rank #1 (Strong Buy).
FORTRESS INVEST (FIG): Free Stock Analysis
LAZARD LTD (LAZ): Free Stock Analysis Report
OCH-ZIFF CAPTL (OZM): Free Stock Analysis
WADDELL&REED -A (WDR): Free Stock Analysis
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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
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
Fortress Investment Group LLC
Och-Ziff Capital Management Group LLC
). All these stocks carry the same Zacks Rank as Waddell &