NEW YORK (TheStreet) -- Shares of Cowen Group (COWN) were gaining 5.3% to $5.78 on heavy trading volume Monday after the company announced the development of a new suite of electronic products and analytical tools for investors.
The new tools will help investors efficiently trade the 1400 stocks included in the SEC's recently approved two-year pilot program. The program will start on May 6, 2016 and will "widen the minimum quoting and trading increments for stocks of certain small-cap companies to test for long-term changes to trading these stocks," according to the company.
"Once the pilot program begins, trading rules will no longer be 'one-size-fits-all,'" John Cosenza, Co-Head of Cowen / ATM said in a statement. "As a leader in non-conflicted, algorithmic execution and development of solutions to efficiently execute trades, products that address the small-cap pilot program will be an important component of our overall product suite."
About 3 million shares of Cowen were traded by 2:35 p.m. Monday, above the company's average trading volume of about 1.1 million shares a day.
TheStreet Ratings team rates COWEN GROUP INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate COWEN GROUP INC (COWN) a HOLD. The primary factors that have impacted our rating are mixed -- some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, notable return on equity and attractive valuation levels. However, as a counter to these strengths, we find that the growth in the company's earnings per share has not been good."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 5.2%. Since the same quarter one year prior, revenues rose by 21.5%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Capital Markets industry and the overall market, COWEN GROUP INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
- 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 69.7% when compared to the same quarter one year prior, rising from $9.84 million to $16.70 million.
- COWEN GROUP 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. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, COWEN GROUP INC increased its bottom line by earning $1.41 versus $0.04 in the prior year. For the next year, the market is expecting a contraction of 62.4% in earnings ($0.53 versus $1.41).
- You can view the full analysis from the report here: COWN Ratings Report