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Evercore (EVR) Gains 14.5% YTD: Will the Uptrend Persist?
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Evercore Inc. (EVR - Free Report) , a global independent investment banking advisory firm operating from its offices and affiliates in North America, Europe, the Middle East and Asia, is in investors’ spotlight right now. The stock has increased 14.5% year to date against the industry’s fall of 11.3%.
Evercore has been able to successfully deliver an impressive performance in the past. In the past three to five years, EVR witnessed earnings per share growth of 19.72% which is greater than the industry’s average of 16.71%.
Despite the muted deal making scenario in the current year, its efforts to enhance client base in advisory solutions and a strong backlog underline the company's organic growth efforts. This will help it navigate a tough operating backdrop and support financials in the upcoming period.
Over the past 30 days, the Zacks Consensus Estimate for current-year earnings of this Zacks Rank #3 (Hold) stock has remained unchanged at $9.01 per share.
Image Source: Zacks Investment Research
Here we present certain key factors that are likely to keep aiding Evercore’s price appreciation.
Revenue Growth Initiatives Bode Well: The company’s efforts to boost its client base in advisory solutions, diversify revenue sources and expand geographically aid revenue growth in the investment banking segment. Most of Evercore’s revenues are generated from this segment.
Though, investment banking net revenues declined in first-quarter 2023 due to lower advisory and underwriting fees, the metric has been rising over the years. EVR’s strong backlog and business investments will drive investment banking business growth in the upcoming quarters.
Strong Balance Sheet Position Reflects Sound Liquidity: Evercore continues to maintain a strong balance sheet. As of Mar 31, 2023, cash and cash equivalents were $579.2 million, and investment securities and certificates of deposit were $803.1 million. This exceeded EVR’s total notes payable due of $372.5 million as of the same date.
Moreover, current assets exceeded current liabilities by $1.5 billion as of the same date. Notably, with sound liquidity, Evercore is less likely to default interest and debt repayments if the economic situation worsens.
Sustainable Capital Deployment Activities: Evercore remains committed to enhancing shareholders’ value as seen from its involvement in steady capital deployment activities.On Apr 26, 2023, it announced its dividend of 76 cents per share, representing a hike of 5.6% from the prior payout. Notably, over the past three years (ended 2022), the annual dividend per share increased at a compound annual growth rate of 9.5%.
Apart from paying out quarterly dividends, the company has a share repurchase program in place. In February 2022, Evercore was authorized with a share repurchase program worth $1.4 billion with no expiration date. As of Mar 31, 2023, it had $6.4 million authorization remaining under the repurchase plan. Further, consistent earnings and strong liquidity position indicate that the capital deployment activities are sustainable.
Conclusion
EVR’s efforts to diversify revenues and boost its client base in advisory solutions will continue to support growth. Also, its strong balance sheet position is likely to aid capital deployment activities in the upcoming period.
The Zacks Consensus Estimate for VEL’s 2023 earnings has been revised 14.8% upward over the past 30 days. The stock has increased 25.7% over the past six months.
The consensus estimate for CCB’s fiscal 2023 earnings has been revised 4.9% upward over the past 30 days. The company’s share price has decreased 19.4% over the past six months.
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Evercore (EVR) Gains 14.5% YTD: Will the Uptrend Persist?
Evercore Inc. (EVR - Free Report) , a global independent investment banking advisory firm operating from its offices and affiliates in North America, Europe, the Middle East and Asia, is in investors’ spotlight right now. The stock has increased 14.5% year to date against the industry’s fall of 11.3%.
Evercore has been able to successfully deliver an impressive performance in the past. In the past three to five years, EVR witnessed earnings per share growth of 19.72% which is greater than the industry’s average of 16.71%.
Despite the muted deal making scenario in the current year, its efforts to enhance client base in advisory solutions and a strong backlog underline the company's organic growth efforts. This will help it navigate a tough operating backdrop and support financials in the upcoming period.
Over the past 30 days, the Zacks Consensus Estimate for current-year earnings of this Zacks Rank #3 (Hold) stock has remained unchanged at $9.01 per share.
Image Source: Zacks Investment Research
Here we present certain key factors that are likely to keep aiding Evercore’s price appreciation.
Revenue Growth Initiatives Bode Well: The company’s efforts to boost its client base in advisory solutions, diversify revenue sources and expand geographically aid revenue growth in the investment banking segment. Most of Evercore’s revenues are generated from this segment.
Though, investment banking net revenues declined in first-quarter 2023 due to lower advisory and underwriting fees, the metric has been rising over the years. EVR’s strong backlog and business investments will drive investment banking business growth in the upcoming quarters.
Strong Balance Sheet Position Reflects Sound Liquidity: Evercore continues to maintain a strong balance sheet. As of Mar 31, 2023, cash and cash equivalents were $579.2 million, and investment securities and certificates of deposit were $803.1 million. This exceeded EVR’s total notes payable due of $372.5 million as of the same date.
Moreover, current assets exceeded current liabilities by $1.5 billion as of the same date. Notably, with sound liquidity, Evercore is less likely to default interest and debt repayments if the economic situation worsens.
Sustainable Capital Deployment Activities: Evercore remains committed to enhancing shareholders’ value as seen from its involvement in steady capital deployment activities.On Apr 26, 2023, it announced its dividend of 76 cents per share, representing a hike of 5.6% from the prior payout. Notably, over the past three years (ended 2022), the annual dividend per share increased at a compound annual growth rate of 9.5%.
Apart from paying out quarterly dividends, the company has a share repurchase program in place. In February 2022, Evercore was authorized with a share repurchase program worth $1.4 billion with no expiration date. As of Mar 31, 2023, it had $6.4 million authorization remaining under the repurchase plan. Further, consistent earnings and strong liquidity position indicate that the capital deployment activities are sustainable.
Conclusion
EVR’s efforts to diversify revenues and boost its client base in advisory solutions will continue to support growth. Also, its strong balance sheet position is likely to aid capital deployment activities in the upcoming period.
Finance Stocks Worth Considering
A couple of better-ranked stocks from the finance sector are Velocity Financial, Inc. (VEL - Free Report) and Coastal Financial Corporation (CCB - Free Report) , each currently carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for VEL’s 2023 earnings has been revised 14.8% upward over the past 30 days. The stock has increased 25.7% over the past six months.
The consensus estimate for CCB’s fiscal 2023 earnings has been revised 4.9% upward over the past 30 days. The company’s share price has decreased 19.4% over the past six months.