Legg Mason Upped to Strong Buy - Analyst Blog
March 25 2013 - 8:19AM
Zacks
On Mar 23, Zacks Investment Research upgraded Legg Mason
Inc. (LM) to a Zacks Rank #1 (Strong Buy).
Why the Upgrade?
Legg Mason has witnessed rising earnings estimates on the back of
strong fiscal third -quarter 2013 results. Moreover, this
property and casualty insurer delivered positive earnings surprises
in three out of last four quarters. The long-term expected earnings
growth rate for this stock is 17.1%
Legg Mason reported fiscal third-quarter 2013 results on Feb 1.
Non-GAAP earnings per share came in at 70 cents, better than the
Zack Consensus Estimate of 54 cents per share. Better-than-expected
results reflected higher top-line growth, aided by improved
investment advisory fees and other revenues.
Legg Mason’s total revenue was $673.9 million, up 7.5% year over
year, driven by higher performance fees.
Moreover, in mid-March, Legg Mason together with its affiliate,
Permal Group, closed the acquisition of London-based
fund-of-hedge-funds firm, Fauchier Partners. Fauchier will be
integrated with Permal to form a new entity with asset under
management worth $24 billion. The transaction is expected to be
accretive to Legg Mason’s earnings in the first year and reflects
the company’s aim of providing exceptional services to its
clients.
The Zacks Consensus Estimate for 2013 increased 77.5% to $2.77 per
share as 2 of 4 estimates were revised higher over the last 60
days. Also for 2014, 8 of 10 estimates moved up, pushing the Zacks
Consensus Estimate higher by 30.4% to $2.83 over the same time
frame.
Other Stocks to Consider
Other investment managers like Apollo Global Management,
LLC. (APO), Lazard Ltd. (LAZ) and
Virtus Investment Partners, Inc. (VRTS) carry a
Zacks Rank #1 (Strong Buy) and are worth noting.
APOLLO GLOBAL-A (APO): Free Stock Analysis Report
LAZARD LTD (LAZ): Free Stock Analysis Report
LEGG MASON INC (LM): Free Stock Analysis Report
VIRTUS INVESTMT (VRTS): Free Stock Analysis Report
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