Zacks Investment Research cut shares of Waddell & Reed (NYSE:WDR) from a strong-buy rating to a hold rating in a research note released on Friday morning.
According to Zacks, “Waddell & Reed's shares have underperformed the industry over the last three months. Yet, the company has an impressive earnings surprise history, having surpassed the Zacks Consensus Estimate in three of the trailing four quarters. Estimates have been stable lately ahead of the company's first-quarter 2018 earnings release. As the company is making efforts to improve efficiency and optimize its operations, expenses are likely to trend lower in the next few quarters, thereby supporting bottom-line growth. Further, its initiatives through Project E are likely to boost top-line growth in the long run. However, pressure on revenues, mainly because of lower sales volumes and a tough operating environment remains a major concern. Also, muted growth in assets under management (AUM) is likely to hamper its financials in the near term.”
Several other equities research analysts have also recently issued reports on the stock. Morgan Stanley decreased their target price on shares of Waddell & Reed from $21.00 to $19.00 and set an underweight rating on the stock in a research report on Tuesday. Keefe, Bruyette & Woods reissued a hold rating and issued a $23.00 target price on shares of Waddell & Reed in a research report on Friday, December 22nd. Citigroup raised shares of Waddell & Reed from a sell rating to a neutral rating and set a $24.00 target price on the stock in a research report on Wednesday, January 31st. Bank of America set a $20.00 target price on shares of Waddell & Reed and gave the stock a sell rating in a research report on Tuesday, January 30th. Finally, Jefferies Group reissued a hold rating and issued a $23.00 target price on shares of Waddell & Reed in a research report on Thursday, January 11th. Five investment analysts have rated the stock with a sell rating, four have assigned a hold rating and one has given a buy rating to the stock. The company has an average rating of Hold and a consensus price target of $21.50.
Shares of NYSE WDR traded down $0.70 during midday trading on Friday, reaching $19.93. 1,462,235 shares of the stock were exchanged, compared to its average volume of 1,894,038. The company has a market cap of $1,719.75, a PE ratio of 10.38 and a beta of 1.95. Waddell & Reed has a 52-week low of $16.32 and a 52-week high of $23.82. The company has a debt-to-equity ratio of 0.11, a current ratio of 3.09 and a quick ratio of 1.16.
Waddell & Reed (NYSE:WDR) last issued its quarterly earnings results on Tuesday, January 30th. The asset manager reported $0.48 EPS for the quarter, topping analysts’ consensus estimates of $0.45 by $0.03. The business had revenue of $294.48 million during the quarter, compared to the consensus estimate of $286.55 million. Waddell & Reed had a net margin of 10.72% and a return on equity of 16.63%. The company’s quarterly revenue was up .5% compared to the same quarter last year. During the same period in the previous year, the firm posted $0.43 earnings per share. analysts anticipate that Waddell & Reed will post 2.23 EPS for the current year.
The business also recently announced a quarterly dividend, which will be paid on Tuesday, May 1st. Investors of record on Tuesday, April 10th will be given a $0.25 dividend. The ex-dividend date is Monday, April 9th. This represents a $1.00 annualized dividend and a dividend yield of 5.02%. Waddell & Reed’s dividend payout ratio is presently 52.08%.
In related news, Director Jerry W. Walton sold 5,792 shares of the firm’s stock in a transaction that occurred on Thursday, February 1st. The shares were sold at an average price of $22.95, for a total value of $132,926.40. Following the sale, the director now directly owns 81,332 shares of the company’s stock, valued at $1,866,569.40. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through this hyperlink. 3.40% of the stock is currently owned by company insiders.
A number of hedge funds have recently made changes to their positions in WDR. Assetmark Inc. acquired a new position in Waddell & Reed during the fourth quarter valued at approximately $103,000. Contravisory Investment Management Inc. acquired a new position in Waddell & Reed during the fourth quarter valued at approximately $161,000. Xact Kapitalforvaltning AB acquired a new position in Waddell & Reed during the fourth quarter valued at approximately $224,000. Elkfork Partners LLC acquired a new position in Waddell & Reed during the fourth quarter valued at approximately $234,000. Finally, MANA Advisors LLC acquired a new position in Waddell & Reed during the fourth quarter valued at approximately $238,000. 97.43% of the stock is currently owned by hedge funds and other institutional investors.
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About Waddell & Reed
Waddell & Reed Financial, Inc, through its subsidiaries, provides investment management and advisory, investment product underwriting and distribution, and shareholder services administration to mutual funds, and institutional and separately managed accounts in the United States. The company acts as an investment adviser for institutional and other private investors, and provides sub advisory services to other investment companies; and underwrites and distributes registered open-end mutual fund portfolios.
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