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Analyst Blog

In tune with its efforts to boost stockholders’ return, asset manager Lazard Ltd. (LAZ - Analyst Report) announced a special dividend of 25 cents per share on its outstanding Class A common stock. The new dividend will be paid on Dec 27 to shareholders of record as of Dec 20. Notably, Lazard had also declared a special dividend of 20 cents in December last year.

Lazard has a record of consistently increasing its regular quarterly dividend since 2005. Even during the financial crisis when many banks and asset mangers slashed the dividend amount or discontinued dividend payment, Lazard not only continued with its payout but managed to increase it as well. Recently, in April, the company hiked its dividend by 37.5% to 25 cents per share.

Apart from regular dividend payments, Lazard has an effective share buyback policy in place. The company repurchased 3.2 million shares at an average price of $33.72 per share during the first nine months of 2013.

At the end of the third quarter, the company had remaining share repurchase authorization worth $76 million. Further, on Oct 23, 2013, Lazard’s board of directors authorized an additional share repurchase of up to $100 million, which is scheduled to expire on Dec 31, 2015.

The company’s steady capital deployment activities reflect its strong balance sheet position. As of Sep 30, 2013, its cash and cash equivalents were around $688.4 million compared with $601.5 million as of Jun 30, 2012. Total stockholders’ equity was $657.1 million, as against $592.2 million as of Jun 30, 2012.

Lazard currently carries a Zacks Rank #2 (Buy). Some better-ranked investment management firms include Artisan Partners Asset Management Inc. (APAM - Snapshot Report), Kohlberg Kravis Roberts & Co. L.P. (KKR - Snapshot Report) and Virtus Investment Partners, Inc. (VRTS - Snapshot Report). All these stocks have a Zacks Rank #1 (Strong Buy).

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