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5 Reasons to Add Invesco (IVZ) Stock to Your Portfolio Now

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Given a solid liquidity position and steady earnings growth, Invesco Ltd. (IVZ - Free Report) seems to be a good investment option now. Moreover, its widening global presence, along with broad diversification, will help it generate further momentum.

Shares of the company have gained 5.1% in the past year, underperforming 24.8% growth recorded by the industry.

Nevertheless, analysts seem to be optimistic about its growth prospects as evident from the upward estimate revisions. Over the last 60 days, the Zacks Consensus Estimate for current-year earnings has been revised 5.8% upward. Thus, the stock has a Zacks Rank #2 (Buy).

In fact, given the positive estimate revisions and solid Zacks Rank, its price performance is expected to improve in the future.



The various other aspects that make Invesco an attractive investment option are:

Earnings Per Share (EPS) Growth: In the last three to five years, Invesco witnessed EPS growth of 4.6%, driven by strong global presence and organic growth. The company’s earnings are projected to grow 14.1% and 9.2% in 2018 and 2019, respectively.

Further, its long-term (three to five years) expected EPS growth of 12.1% promises reward for shareholders.

Revenue Strength: Invesco’s net revenues witnessed a five-year CAGR of 2.7% (2013-2017). The company’s diverse product offerings and alternative investment strategies will continue to attract investors, which will support top-line growth in the upcoming quarters. Moreover, the top line is expected to grow nearly 12% in 2018, higher than the industry average of 7.2%. This indicates the company's superiority in generating revenues.

Steady Assets Under Management (AUM) Growth: Invesco’s AUM has consistently demonstrated strong growth, aided by increasing net inflows. Over the last five years (2013-2017), total AUM witnessed a CAGR of 4.8%. The growth trajectory will likely continue to be driven by the company’s diversified products, revenue mix and growing demand for passive products and alternate asset classes.

Stock Seems Undervalued: Invesco looks undervalued with respect to its price/book and price/earnings ratios. The company has a P/B ratio of 1.6, which is below the industry average of 1.8. Also, its P/E (F1) ratio, which is currently 10.8, is lower than the industry average of 11.6.

Superior Return on Equity (ROE): Invesco has an ROE of 13.51%, slightly better than the industry average of 13.45%. This shows that the company reinvests its cash more efficiently.

Other Stocks to Consider

Some other stocks in the same industry worth considering are Waddell & Reed Financial, Inc. , Ameriprise Financial, Inc. (AMP - Free Report) and Affiliated Managers Group, Inc. (AMG - Free Report) .

The Zacks Consensus Estimate for Waddell & Reed has been revised 5.5% upward for the current year, in the last 30 days. The company’s share price has increased 9.4% in the last year. The stock currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Ameriprise Financial’s earnings estimate for the current year has remained stable in the last 30 days. Its share price has increased 23.5% over the last year. It has a Zacks Rank #2.

Affiliated Managers also carries a Zacks Rank of 2. It has witnessed an upward earnings estimate revision of nearly 1% for the current year, in the last 30 days. Over the last year, its share price has increased 16%.

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Invesco Ltd. (IVZ) - free report >>

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