NEW YORK (TheStreet) -- Sterne Agee upgraded Waddell & Reed (WDR - Get Report) to "buy," increased its estimates and set an $80 price target. The firm noted the stock is down 15% from April highs and said solid organic growth can drive higher margins.
The stock was up 2.42% to $64.84 at 9:33 a.m. on Tuesday.
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- The revenue growth came in higher than the industry average of 5.2%. Since the same quarter one year prior, revenues rose by 22.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Capital Markets industry and the overall market, WADDELL&REED FINL INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
- 37.88% is the gross profit margin for WADDELL&REED FINL INC which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 18.98% is above that of the industry average.
- Net operating cash flow has increased to $88.94 million or 45.47% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 15.21%.
- WADDELL&REED FINL INC has improved earnings per share by 39.7% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, WADDELL&REED FINL INC increased its bottom line by earning $2.96 versus $2.25 in the prior year. This year, the market expects an improvement in earnings ($3.76 versus $2.96).
- You can view the full analysis from the report here: WDR Ratings Report