Federated Investors Inc. (FII) Downgraded to Sell at Zacks Investment Research
Federated Investors Inc. (NYSE:FII) was downgraded by Zacks Investment Research from a “hold” rating to a “sell” rating in a report issued on Thursday.
According to Zacks, “We remain concerned about Federated’s asset under management owing to volatility in equity markets. Further, stringent regulations in the investment management business will hurt its profitability. Also, compliance-related fees are expected to continue rising in the near term. Notably, management expects compensation expenses to increase to $74 million in third-quarter 2016. Also, fee waivers for third-quarter 2016 are estimated to result in a negative pre-tax impact of $4 million.This will continue to exert pressure on the company’s earnings. However, Federated’s growth potential looks encouraging, given its diversified investment products and strategic expansion moves. Moreover, steady capital deployment activities should enhance shareholders’ value.”
FII has been the topic of several other research reports. Jefferies Group reissued a “buy” rating and set a $35.00 price objective on shares of Federated Investors in a report on Friday, July 29th. Credit Suisse Group AG set a $27.00 price objective on Federated Investors and gave the stock a “sell” rating in a report on Sunday, July 31st. Finally, Keefe, Bruyette & Woods lifted their price objective on Federated Investors from $33.00 to $35.00 and gave the stock a “market perform” rating in a report on Monday, August 1st. Four analysts have rated the stock with a sell rating, one has assigned a hold rating and two have issued a buy rating to the company. The company presently has a consensus rating of “Hold” and a consensus price target of $30.75.
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Shares of Federated Investors (NYSE:FII) traded down 1.74% on Thursday, hitting $27.63. The stock had a trading volume of 351,328 shares. Federated Investors has a 52 week low of $22.76 and a 52 week high of $33.13. The company has a market cap of $2.75 billion, a price-to-earnings ratio of 15.18 and a beta of 1.51. The firm has a 50 day moving average price of $30.96 and a 200-day moving average price of $30.76.
Federated Investors (NYSE:FII) last issued its quarterly earnings results on Thursday, July 28th. The company reported $0.51 EPS for the quarter, topping the Thomson Reuters’ consensus estimate of $0.48 by $0.03. The company had revenue of $286.74 million for the quarter, compared to the consensus estimate of $284.39 million. Federated Investors had a return on equity of 28.98% and a net margin of 18.30%. The company’s revenue for the quarter was up 25.7% on a year-over-year basis. During the same period in the previous year, the business posted $0.40 EPS. Analysts anticipate that Federated Investors will post $1.98 EPS for the current year.
Hedge funds have recently made changes to their positions in the stock. Vanguard Group Inc. raised its stake in shares of Federated Investors by 2.0% in the second quarter. Vanguard Group Inc. now owns 7,059,093 shares of the company’s stock valued at $203,161,000 after buying an additional 138,284 shares in the last quarter. BlackRock Fund Advisors raised its position in Federated Investors by 8.3% in the first quarter. BlackRock Fund Advisors now owns 6,138,156 shares of the company’s stock worth $177,086,000 after buying an additional 470,282 shares in the last quarter. Royce & Associates LP raised its position in Federated Investors by 4.3% in the second quarter. Royce & Associates LP now owns 5,176,204 shares of the company’s stock worth $148,971,000 after buying an additional 212,673 shares in the last quarter. BlackRock Institutional Trust Company N.A. raised its position in Federated Investors by 2.9% in the second quarter. BlackRock Institutional Trust Company N.A. now owns 2,897,691 shares of the company’s stock worth $83,396,000 after buying an additional 82,577 shares in the last quarter. Finally, State Street Corp raised its position in Federated Investors by 1.2% in the second quarter. State Street Corp now owns 2,708,256 shares of the company’s stock worth $77,947,000 after buying an additional 33,184 shares in the last quarter. 75.46% of the stock is currently owned by institutional investors and hedge funds.
About Federated Investors
Federated Investors, Inc (Federated) is a provider of investment management products and related financial services. The Company is engaged in sponsoring, marketing and providing investment-related services to various investment products, including mutual funds and Separate Accounts, which include separately managed accounts, institutional accounts, sub-advised funds and other managed products, in both domestic and international markets.
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