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6 Reasons Why Piper Sandler (PIPR) Stock is Worth Betting On
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It seems to be a wise idea to add Piper Sandler Companies (PIPR - Free Report) stock to your portfolio amid the coronavirus crisis, given the strength in its fundamentals and solid prospects. Moreover, the company’s steady capital-deployment activities reflect a strong balance-sheet position.
Further, analysts seem optimistic about the stock’s performance. Over the past 60 days, the Zacks Consensus Estimate for earnings moved 14.5% and 7.9% upward for 2020 and 2021, respectively. The company currently sports a Zacks Rank #1 (Strong Buy).
Shares of Piper Sandler have gained 11.6% in the past 12 months, underperforming the industry's 11.9% rise.
Factors That Make Piper Sandler a Solid Pick
Earnings Growth: Over the past three to five years, Piper Sandler has recorded earnings growth of 16.1%. Though 2020 earnings are expected to be down 22.6%, the same is projected to rise marginally in 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 83.1%.
Revenue Strength: Piper Sandler’s revenues have been witnessing continued growth, with a five-year CAGR of 5.5% (ended 2019). This uptick primarily resulted from the rise in revenues from institutional brokerage and fall in interest expenses.
Further, the company’s revenues are projected to grow at a rate of 19.1% in the current year compared with no growth for the industry. Also, the company is estimated to record 1.6% revenue growth in 2021.
Solid Balance-Sheet Position: As of Jun 30, 2020, Piper Sandler had total debt worth $436.4 million, higher than the cash & cash equivalents balance of $235.9 million. However, the company's current total debt to total capital of 19.3% is significantly below the industry average of 67.8%. This suggests 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.
Steady Capital-Deployment Activities: Piper Sandler is committed toward enhancing shareholders’ value. In July, the company announced a dividend hike of 50% to 30 cents per share. Considering yesterday’s closing price of $76.87 per share, the company's dividend yield currently stands at 1.72%. Thus, given the earnings strength and solid balance-sheet position, the company will likely be able to sustain current capital deployments.
Superior ROE: Piper Sandler’s trailing 12-month return on equity (ROE) highlights its growth potential. The company’s ROE of 15.64% compares favorably with the industry’s 12.68%, underlining the fact that it is more efficient in using shareholder funds than its peers.
Stock Looks Undervalued: Piper Sandler 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 13.20, which is below the industry average of 14.01. Also, its P/S ratio of 1.33 is lower than the industry average of 1.44.
T. Rowe Price Group, Inc. (TROW - Free Report) has witnessed 1% upward earnings estimate revision for the ongoing year in the past 30 days. Its shares have appreciated 25.1% so far this year. It currently carries a Zacks Rank of 2.
CVB Financial Corp. (CVBF - Free Report) witnessed a marginal upward estimate revision to $1.26 for 2020 earnings over the past 30 days. Its shares have depreciated 12.7% over the past year. At present, it carries a Zacks Rank of 2.
Breakout Biotech Stocks with Triple-Digit Profit Potential
The biotech sector is projected to surge beyond $775 billion by 2024 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases.
Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Our recent biotech recommendations have produced gains of +50%, +83% and +164% in as little as 2 months. The stocks in this report could perform even better.
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6 Reasons Why Piper Sandler (PIPR) Stock is Worth Betting On
It seems to be a wise idea to add Piper Sandler Companies (PIPR - Free Report) stock to your portfolio amid the coronavirus crisis, given the strength in its fundamentals and solid prospects. Moreover, the company’s steady capital-deployment activities reflect a strong balance-sheet position.
Further, analysts seem optimistic about the stock’s performance. Over the past 60 days, the Zacks Consensus Estimate for earnings moved 14.5% and 7.9% upward for 2020 and 2021, respectively. The company currently sports a Zacks Rank #1 (Strong Buy).
Shares of Piper Sandler have gained 11.6% in the past 12 months, underperforming the industry's 11.9% rise.
Factors That Make Piper Sandler a Solid Pick
Earnings Growth: Over the past three to five years, Piper Sandler has recorded earnings growth of 16.1%. Though 2020 earnings are expected to be down 22.6%, the same is projected to rise marginally in 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 83.1%.
Revenue Strength: Piper Sandler’s revenues have been witnessing continued growth, with a five-year CAGR of 5.5% (ended 2019). This uptick primarily resulted from the rise in revenues from institutional brokerage and fall in interest expenses.
Further, the company’s revenues are projected to grow at a rate of 19.1% in the current year compared with no growth for the industry. Also, the company is estimated to record 1.6% revenue growth in 2021.
Solid Balance-Sheet Position: As of Jun 30, 2020, Piper Sandler had total debt worth $436.4 million, higher than the cash & cash equivalents balance of $235.9 million. However, the company's current total debt to total capital of 19.3% is significantly below the industry average of 67.8%. This suggests 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.
Steady Capital-Deployment Activities: Piper Sandler is committed toward enhancing shareholders’ value. In July, the company announced a dividend hike of 50% to 30 cents per share. Considering yesterday’s closing price of $76.87 per share, the company's dividend yield currently stands at 1.72%. Thus, given the earnings strength and solid balance-sheet position, the company will likely be able to sustain current capital deployments.
Superior ROE: Piper Sandler’s trailing 12-month return on equity (ROE) highlights its growth potential. The company’s ROE of 15.64% compares favorably with the industry’s 12.68%, underlining the fact that it is more efficient in using shareholder funds than its peers.
Stock Looks Undervalued: Piper Sandler 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 13.20, which is below the industry average of 14.01. Also, its P/S ratio of 1.33 is lower than the industry average of 1.44.
Other Stocks to Consider
Eaton Vance Corp. (EV - Free Report) has witnessed a marginal upward earnings estimate revision for the ongoing year in the past 30 days. Its shares have declined 1.2% over the past year. Currently, it carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
T. Rowe Price Group, Inc. (TROW - Free Report) has witnessed 1% upward earnings estimate revision for the ongoing year in the past 30 days. Its shares have appreciated 25.1% so far this year. It currently carries a Zacks Rank of 2.
CVB Financial Corp. (CVBF - Free Report) witnessed a marginal upward estimate revision to $1.26 for 2020 earnings over the past 30 days. Its shares have depreciated 12.7% over the past year. At present, it carries a Zacks Rank of 2.
Breakout Biotech Stocks with Triple-Digit Profit Potential
The biotech sector is projected to surge beyond $775 billion by 2024 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases.
Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Our recent biotech recommendations have produced gains of +50%, +83% and +164% in as little as 2 months. The stocks in this report could perform even better.
See these 7 breakthrough stocks now>>