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Will T. Rowe Price Benefit from Deal with Henderson Global?
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T. Rowe Price Group, Inc. (TROW - Free Report) , in order to provide additional high yield investment opportunity to its clients and to further strengthen its global fixed income franchise, has agreed to acquire a new fund from Henderson Global Investors. Henderson Global Investors is the North American subsidiary of London-based Henderson Global Investors Inc.
The transaction is expected to be completed by May 2017, upon receiving shareholder approval.
Once acquired, the Henderson High Yield Opportunities Fund will be reclassified into a new mutual fund called the T. Rowe Price U.S. High Yield Fund. Further, the portfolio management team will function separately in an office based in Philadelphia, while the trading and research team will be completely segregated from T. Rowe Price's existing platforms.
Currently, this Henderson fund has an investment strategy, which mainly focuses on total return through investments in the U.S. high yield bonds. Moreover, in order to make the new fund complement T. Rowe Price’s existing high yield strategy, which focuses on high current income and invests in both domestic and international bonds, the newly formed funds’ investment program will be kept substantially similar to the existing Henderson fund.
According to Ted Wiese, head of fixed income for T. Rowe Price, "The Henderson fund and its team complement our highly regarded global high yield franchise, headed by veteran Mark Vaselkiv. Its outstanding performance history under the current team allows us to offer attractive high yield investment options for investors to whom the T. Rowe Price High Yield Bond Fund is closed."
Notably, once the acquisition is complete, fund manager Kevin Loome and his team of four analysts, along with a trader who presently manage the Henderson fund, will report to Ted Wiese.
Formerly, Loome worked for T. Rowe Price for 11 years and was a high yield investment professional at the company. However, in 2007 he had left his job in order to manage the high yield team at another investment management firm.
T. Rowe Price is well positioned for organic growth over the long term, given its strategic initiatives. These efforts include launching new investment vehicles, enhancing client engagement capabilities in each distribution channels and derive long-term cost efficiencies. Moving ahead, such measures are likely to result in solid revenue growth.
Moreover, in 2016, shares of T. Rowe Price increased 5.3%, outpacing the Zacks categorized Financial-Investment Management industry’s gain of 3.4%.
Currently, T. Rowe Price carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the same space include Apollo Global Management, LLC (APO - Free Report) , Ameriprise Financial, Inc. (AMP - Free Report) and Lazard Ltd (LAZ - Free Report) .
Apollo Global has witnessed an upward earnings estimate revision of 9.2% for the current year over the past 30 days. Also, its share price has increased 19.9% in the last six months. It currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Ameriprise Financial carries a Zacks Rank #2 (Buy) and its earnings estimates have been revised 2.3% upward for the current year, over the past 30 days. Moreover, its share price has increased 32.4% in the last six months.
Lazard also has a Zacks Rank #2. Its current year earnings estimates have witnessed an upward revision of 1.9%, over the past 30 days and its share price has increased 17.3% in the past six months.
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Will T. Rowe Price Benefit from Deal with Henderson Global?
T. Rowe Price Group, Inc. (TROW - Free Report) , in order to provide additional high yield investment opportunity to its clients and to further strengthen its global fixed income franchise, has agreed to acquire a new fund from Henderson Global Investors. Henderson Global Investors is the North American subsidiary of London-based Henderson Global Investors Inc.
The transaction is expected to be completed by May 2017, upon receiving shareholder approval.
Once acquired, the Henderson High Yield Opportunities Fund will be reclassified into a new mutual fund called the T. Rowe Price U.S. High Yield Fund. Further, the portfolio management team will function separately in an office based in Philadelphia, while the trading and research team will be completely segregated from T. Rowe Price's existing platforms.
Currently, this Henderson fund has an investment strategy, which mainly focuses on total return through investments in the U.S. high yield bonds. Moreover, in order to make the new fund complement T. Rowe Price’s existing high yield strategy, which focuses on high current income and invests in both domestic and international bonds, the newly formed funds’ investment program will be kept substantially similar to the existing Henderson fund.
According to Ted Wiese, head of fixed income for T. Rowe Price, "The Henderson fund and its team complement our highly regarded global high yield franchise, headed by veteran Mark Vaselkiv. Its outstanding performance history under the current team allows us to offer attractive high yield investment options for investors to whom the T. Rowe Price High Yield Bond Fund is closed."
Notably, once the acquisition is complete, fund manager Kevin Loome and his team of four analysts, along with a trader who presently manage the Henderson fund, will report to Ted Wiese.
Formerly, Loome worked for T. Rowe Price for 11 years and was a high yield investment professional at the company. However, in 2007 he had left his job in order to manage the high yield team at another investment management firm.
T. Rowe Price is well positioned for organic growth over the long term, given its strategic initiatives. These efforts include launching new investment vehicles, enhancing client engagement capabilities in each distribution channels and derive long-term cost efficiencies. Moving ahead, such measures are likely to result in solid revenue growth.
Moreover, in 2016, shares of T. Rowe Price increased 5.3%, outpacing the Zacks categorized Financial-Investment Management industry’s gain of 3.4%.
Currently, T. Rowe Price carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the same space include Apollo Global Management, LLC (APO - Free Report) , Ameriprise Financial, Inc. (AMP - Free Report) and Lazard Ltd (LAZ - Free Report) .
Apollo Global has witnessed an upward earnings estimate revision of 9.2% for the current year over the past 30 days. Also, its share price has increased 19.9% in the last six months. It currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Ameriprise Financial carries a Zacks Rank #2 (Buy) and its earnings estimates have been revised 2.3% upward for the current year, over the past 30 days. Moreover, its share price has increased 32.4% in the last six months.
Lazard also has a Zacks Rank #2. Its current year earnings estimates have witnessed an upward revision of 1.9%, over the past 30 days and its share price has increased 17.3% in the past six months.
A Full-Blown Technological Breakthrough in the Making
Zacks’ Aggressive Growth Strategist Brian Bolan explores autonomous cars in our latest Special Report, Driverless Cars: Your Roadmap to Mega-Profits Today. In addition to who will be selling them and how the auto industry will be impacted, Brian reveals 8 stocks with tremendous gain potential to feed off this phenomenon. Click to see the stocks right now >>