The firm also lowered its price target to $32 from $36 on shares of the Atlanta-based investment management company.
"We move the large-cap asset managers down in our subsector rankings to 5th from 3rd on a view that outflows in active mutual fund products will accelerate in 4Q and especially 1Q17 upon implementation of Department of Labor rules," Deutsche Bank wrote in an analyst note.
The firm's subsector rankings from most favored to least are: exchanges, e-brokers, trust banks (up from 3rd), alternative asset managers and large-cap asset managers.
Deutsche Bank now favors BlackRock (BLK) in the asset managers space.
But "over the long term, we see Invesco as well positioned vs. peers given management has built a very diversified product range by virtually every measure, a strong global distribution platform, and a reasonably good presence in most of the stronger growth areas in asset management," the firm said.
Separately, TheStreet Ratings Team has a "Buy" rating with a score of B- on Invesco stock.
Among the primary strengths of the company is its attractive valuation levels, considering its current price compared to earnings, book value and other measures.
The team believes its strengths outweigh the fact that the company has had sub par growth in net income.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: IVZ