We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
6 Reasons Why Virtus Investment (VRTS) Stock is a Must Buy
Read MoreHide Full Article
It seems to be a wise idea to add Virtus Investment Partners, Inc. (VRTS - Free Report) stock to your portfolio amid the coronavirus crisis, given the strength in fundamentals and solid prospects. Moreover, the company’s steady capital-deployment activities reflect a strong balance-sheet position.
Further, analysts are bullish on the stock. Over the past 60 days, the Zacks Consensus Estimate for earnings moved 7.2% and 30.7% upward for 2020 and 2021, respectively. Also, the company currently sports a Zacks Rank #1 (Strong Buy).
Shares of Virtus Investment have gained 25.7% in the past 12 months compared with the industry's 0.6% increase.
Factors That Make Virtus Investment a Solid Pick
Earnings Growth: Over the past three to five years, Virtus Investment has recorded earnings growth of 24.2% compared with the industry’s average of 8.1%. This momentum is likely to continue in the near term, reflected by the projected earnings growth rate of 4.2% for 2020 (against the projection of a 1.9% decline for the industry) and 35.8% for 2021.
Moreover, the company has an impressive earnings surprise history. Its earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 6.9%.
Revenue Strength: Virtus Investment’s total revenues have witnessed a CAGR of 15% over the last three years (2017-2019). This uptick primarily resulted from the steady rise in income from total investment management fees. Though the company’s sales are projected to decline 6% in 2020 (against the projection of no growth for the industry), it is expected to be up 30.6% for 2021.
Solid Balance-Sheet Position: As of Jun 30, 2020, Virtus Investment had total debt worth $234.8 million, lower than the cash & cash equivalents balance of $252.1 million. Moreover, the company’s current total debt to total capital of 26% improved sequentially and is below the industry average of 39.9%. This highlights that the company carries a relatively lesser credit risk and chances of its default in debt payments are likely to be lower even if the economic situation worsens.
Robust Capital Deployment: Virtus Investment’s capital-deployment activities are impressive.Since 2018, the company has been increasing its dividend annually, with the latest one announced in August. Considering yesterday’s closing price of $136.05 per share, the company's dividend yield currently stands at 2.41%. Aided by a robust liquidity position, its capital deployments look sustainable and thus, the company is expected to continue enhancing shareholder value.
Stock Looks Undervalued: Virtus Investment currently looks undervalued, with respect to the price/earnings (P/E) (F1) and price/sales (P/S) ratios. It has a P/E (F1) ratio of 8.49, which is below the industry average of 10.33. Also, the bank’s P/S ratio of 1.76 is lower than the industry average of 1.93.
Superior ROE: Virtus Investment’s trailing 12-month return on equity (ROE) highlights its growth potential. The company’s ROE of 20.04% compares favorably with the industry’s 11.91%, reflecting that it is more efficient in using shareholder funds than its peers.
BrightSphere Investment Group Inc.’s (BSIG - Free Report) Zacks Consensus Estimate for the current-year earnings moved 4.5% north to $1.62 per share in the past two months. The stock currently carries a Zacks Rank of 2.
Eaton Vance Corp.’s (EV - Free Report) Zacks Consensus Estimate for earnings moved up 6.4% to $3.33 in 60 days for 2020. The stock currently carries a Zacks Rank of 2.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Image: Bigstock
6 Reasons Why Virtus Investment (VRTS) Stock is a Must Buy
It seems to be a wise idea to add Virtus Investment Partners, Inc. (VRTS - Free Report) stock to your portfolio amid the coronavirus crisis, given the strength in fundamentals and solid prospects. Moreover, the company’s steady capital-deployment activities reflect a strong balance-sheet position.
Further, analysts are bullish on the stock. Over the past 60 days, the Zacks Consensus Estimate for earnings moved 7.2% and 30.7% upward for 2020 and 2021, respectively. Also, the company currently sports a Zacks Rank #1 (Strong Buy).
Shares of Virtus Investment have gained 25.7% in the past 12 months compared with the industry's 0.6% increase.
Factors That Make Virtus Investment a Solid Pick
Earnings Growth: Over the past three to five years, Virtus Investment has recorded earnings growth of 24.2% compared with the industry’s average of 8.1%. This momentum is likely to continue in the near term, reflected by the projected earnings growth rate of 4.2% for 2020 (against the projection of a 1.9% decline for the industry) and 35.8% for 2021.
Moreover, the company has an impressive earnings surprise history. Its earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 6.9%.
Revenue Strength: Virtus Investment’s total revenues have witnessed a CAGR of 15% over the last three years (2017-2019). This uptick primarily resulted from the steady rise in income from total investment management fees. Though the company’s sales are projected to decline 6% in 2020 (against the projection of no growth for the industry), it is expected to be up 30.6% for 2021.
Solid Balance-Sheet Position: As of Jun 30, 2020, Virtus Investment had total debt worth $234.8 million, lower than the cash & cash equivalents balance of $252.1 million. Moreover, the company’s current total debt to total capital of 26% improved sequentially and is below the industry average of 39.9%. This highlights that the company carries a relatively lesser credit risk and chances of its default in debt payments are likely to be lower even if the economic situation worsens.
Robust Capital Deployment: Virtus Investment’s capital-deployment activities are impressive.Since 2018, the company has been increasing its dividend annually, with the latest one announced in August. Considering yesterday’s closing price of $136.05 per share, the company's dividend yield currently stands at 2.41%. Aided by a robust liquidity position, its capital deployments look sustainable and thus, the company is expected to continue enhancing shareholder value.
Stock Looks Undervalued: Virtus Investment currently looks undervalued, with respect to the price/earnings (P/E) (F1) and price/sales (P/S) ratios. It has a P/E (F1) ratio of 8.49, which is below the industry average of 10.33. Also, the bank’s P/S ratio of 1.76 is lower than the industry average of 1.93.
Superior ROE: Virtus Investment’s trailing 12-month return on equity (ROE) highlights its growth potential. The company’s ROE of 20.04% compares favorably with the industry’s 11.91%, reflecting that it is more efficient in using shareholder funds than its peers.
Other Stocks to Consider
Credit Acceptance Corporation’s (CACC - Free Report) Zacks Consensus Estimate for 2020 earnings moved 23.2% upward to $10.48 in the past 60 days. The stock currently holds a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
BrightSphere Investment Group Inc.’s (BSIG - Free Report) Zacks Consensus Estimate for the current-year earnings moved 4.5% north to $1.62 per share in the past two months. The stock currently carries a Zacks Rank of 2.
Eaton Vance Corp.’s (EV - Free Report) Zacks Consensus Estimate for earnings moved up 6.4% to $3.33 in 60 days for 2020. The stock currently carries a Zacks Rank of 2.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>