Update (9:40 a.m.): Updated with Tuesday market information.
NEW YORK (TheStreet) -- Goldman Sachs upgraded Waddell & Reed (WDR) to "buy" from "neutral" and set an $84 target price. The firm contends the market underappreciates the company's consistency and growth.
The stock was up 1.44% to $73.68 at 9:39 a.m. on Tuesday.
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Separately, TheStreet Ratings team rates WADDELL&REED FINL INC as a "buy" with a ratings score of A+. TheStreet Ratings Team has this to say about their recommendation:
"We rate WADDELL&REED FINL INC (WDR) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its robust revenue growth, impressive record of earnings per share growth, compelling growth in net income, expanding profit margins and good cash flow from operations. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth greatly exceeded the industry average of 7.7%. Since the same quarter one year prior, revenues rose by 26.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
- WADDELL&REED FINL INC reported significant earnings per share improvement 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 ($3.73 versus $2.96).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Capital Markets industry. The net income increased by 47.7% when compared to the same quarter one year prior, rising from $53.32 million to $78.76 million.
- 39.15% 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 20.49% is above that of the industry average.
- Net operating cash flow has increased to $105.52 million or 31.41% when compared to the same quarter last year. Despite an increase in cash flow of 31.41%, WADDELL&REED FINL INC is still growing at a significantly lower rate than the industry average of 93.28%.
- You can view the full analysis from the report here: WDR Ratings Report