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4 Reasons that Make Artisan Partners an Attractive Pick Now

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There are plenty of reasons to be optimistic about Artisan Partners Asset Management Inc.’s (APAM - Free Report) growth potential. Among others, the company surpassed earnings estimates in the last quarter on the back of growth in revenues and assets under management.

The company’s shares have lost 6.4% over the last six months, underperforming the Financial – Investment Management industry’s rally of 5.3%.

The company witnessed upward revisions in earnings estimates of 7.5% and 9.6% for the current year and current quarter, respectively, in the last 60 days. As a result, the stock carries a Zacks Rank #2 (Buy).

Key Driving Factors

Earnings Per Share Strength: Over the past three to five years, Artisan Partners witnessed earnings per share (EPS) growth of 8.7%. Further, the company’s earnings are projected to grow 46.1% compared with 10.4% for the broader industry in 2017.

Revenue Growth: The company continues to make steady progress toward improving its top line, with sales recording four-year compounded annual growth rate (“CAGR”) of around 1.7% during 2013–2016 period. Further, the company’s projected sales growth (F1/F0) of 7.93% indicates continued upward momentum in revenues.

Valuation Looks Reasonable: Artisan Partners has a Value Score of 'A'. The Value Style Score condenses all valuation metrics into one actionable score which helps investors steer clear of 'value traps' and identify stocks that are truly trading at a discount. Our research shows that stocks with Style Scores of 'A' or 'B,' when combined with Zacks Rank #1 (Strong Buy) or #2, offer the best upside potential.

Superior Return on Equity (ROE): The company’s ROE of 62.0% compares favorably with the industry’s ROE of 12.1%, reflecting the company’s efficiency in utilizing shareholder’s funds.

Other Stocks that Warrant a Look

First Connecticut Bancorp, Inc. sports a Zacks Rank #1 (Strong Buy). The company’s earnings estimates have been revised 24.3% upward for the current year, in the past 60 days. Also, its share price surged 57.6%, over the last one year. You can see the complete list of today’s Zacks #1 Rank stocks here.

Lazard Ltd. (LAZ - Free Report) witnessed an upward earnings estimate revision of 5.9% for the current year, in the past 60 days. Also, its share price is up 33.9%, over the last one year. It sports a Zacks Rank #2.

Eaton Vance Corp. (EV - Free Report) holds a Zacks Rank #2. It recorded an upward earnings estimate revision of 2.0% for the current year, in the past 60 days. Also, its share price has seen 32.3% rise over the last one year.

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