Federated Investors Inc. (FII) Downgraded to Sell at Zacks Investment Research
According to Zacks, “We remain concerned about Federated’s asset under management owing to volatility in equity markets. Further, stringent regulations in the investment management business will hurt its profitability. Also, compliance-related fees are expected to continue rising in the near term. Notably, management expects compensation expenses to increase to $74 million in third-quarter 2016. Also, fee waivers for third-quarter 2016 are estimated to result in a negative pre-tax impact of $4 million.This will continue to exert pressure on the company’s earnings. However, Federated’s growth potential looks encouraging, given its diversified investment products and strategic expansion moves. Moreover, steady capital deployment activities should enhance shareholders’ value.”
FII has been the subject of several other research reports. Jefferies Group reduced their target price on shares of Federated Investors from $37.00 to $35.00 and set a buy rating for the company in a research note on Tuesday. Keefe, Bruyette & Woods upped their target price on shares of Federated Investors from $33.00 to $35.00 and gave the stock a market perform rating in a research note on Monday, August 1st. Finally, Credit Suisse Group AG set a $27.00 target price on shares of Federated Investors and gave the stock a sell rating in a research note on Sunday, July 31st. Four equities research analysts have rated the stock with a sell rating, one has issued a hold rating and two have given a buy rating to the stock. The company presently has an average rating of Hold and an average price target of $30.13.
Shares of Federated Investors (NYSE:FII) traded down 0.36% during mid-day trading on Thursday, reaching $27.66. 248,283 shares of the company’s stock traded hands. Federated Investors has a 12-month low of $22.76 and a 12-month high of $33.13. The firm has a 50-day moving average of $30.84 and a 200 day moving average of $30.74. The company has a market cap of $2.75 billion, a P/E ratio of 15.20 and a beta of 1.51.
Federated Investors (NYSE:FII) last posted its earnings results on Thursday, July 28th. The company reported $0.51 earnings per share (EPS) for the quarter, topping the Thomson Reuters’ consensus estimate of $0.48 by $0.03. Federated Investors had a net margin of 18.30% and a return on equity of 28.98%. The firm earned $286.74 million during the quarter, compared to analyst estimates of $284.39 million. During the same quarter in the prior year, the business posted $0.40 EPS. The business’s revenue was up 25.7% compared to the same quarter last year. Equities analysts forecast that Federated Investors will post $1.98 EPS for the current year.
Large investors have recently made changes to their positions in the company. Vanguard Group Inc. increased its stake in shares of Federated Investors by 2.0% in the second quarter. Vanguard Group Inc. now owns 7,059,093 shares of the company’s stock worth $203,161,000 after buying an additional 138,284 shares during the last quarter. BlackRock Fund Advisors increased its stake in shares of Federated Investors by 8.3% in the first quarter. BlackRock Fund Advisors now owns 6,138,156 shares of the company’s stock worth $177,086,000 after buying an additional 470,282 shares during the last quarter. Royce & Associates LP increased its stake in shares of Federated Investors by 4.3% in the second quarter. Royce & Associates LP now owns 5,176,204 shares of the company’s stock worth $148,971,000 after buying an additional 212,673 shares during the last quarter. BlackRock Institutional Trust Company N.A. increased its stake in shares of Federated Investors by 2.9% in the second quarter. BlackRock Institutional Trust Company N.A. now owns 2,897,691 shares of the company’s stock worth $83,396,000 after buying an additional 82,577 shares during the last quarter. Finally, State Street Corp increased its stake in shares of Federated Investors by 1.2% in the second quarter. State Street Corp now owns 2,708,256 shares of the company’s stock worth $77,947,000 after buying an additional 33,184 shares during the last quarter. 75.46% of the stock is currently owned by hedge funds and other institutional investors.
About Federated Investors
Federated Investors, Inc (Federated) is a provider of investment management products and related financial services. The Company is engaged in sponsoring, marketing and providing investment-related services to various investment products, including mutual funds and Separate Accounts, which include separately managed accounts, institutional accounts, sub-advised funds and other managed products, in both domestic and international markets.
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