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Federated Hermes, Inc. (FHI) Hits Fresh High: Is There Still Room to Run?
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A strong stock as of late has been Federated Hermes (FHI - Free Report) . Shares have been marching higher, with the stock up 11.4% over the past month. The stock hit a new 52-week high of $47.3 in the previous session. Federated Hermes has gained 14.5% since the start of the year compared to the 9.2% move for the Zacks Finance sector and the 0.9% return for the Zacks Financial - Investment Management industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, having beaten the Zacks Consensus Estimate in each of the last four quarters. In its last earnings report on April 24, 2025, Federated Hermes reported EPS of $1.1 versus consensus estimate of $0.91 while it beat the consensus revenue estimate by 0.88%.
For the current fiscal year, Federated Hermes is expected to post earnings of $4.37 per share on $1.72 in revenues. This represents a 35.29% change in EPS on a 5.25% change in revenues. For the next fiscal year, the company is expected to earn $4.43 per share on $1.78 in revenues. This represents a year-over-year change of 1.23% and 3.42%, respectively.
Valuation Metrics
Federated Hermes may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
Federated Hermes has a Value Score of A. The stock's Growth and Momentum Scores are C and B, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 10.8X current fiscal year EPS estimates, which is not in-line with the peer industry average of 11.9X. On a trailing cash flow basis, the stock currently trades at 13.3X versus its peer group's average of 12.4X. Additionally, the stock has a PEG ratio of 0.84. This is good enough to put the company in the top echelon of all stocks we cover from a value perspective, making Federated Hermes an interesting choice for value investors.
Zacks Rank
We also need to consider the stock's Zacks Rank, as this is even more important than the company's VGM Score. Fortunately, Federated Hermes currently has a Zacks Rank of #2 (Buy) thanks to a solid earnings estimate revision trend.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Federated Hermes meets the list of requirements. Thus, it seems as though Federated Hermes shares could still be poised for more gains ahead.
How Does FHI Stack Up to the Competition?
Shares of FHI have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Affiliated Managers Group, Inc. (AMG - Free Report) . AMG has a Zacks Rank of #2 (Buy) and a Value Score of A, a Growth Score of C, and a Momentum Score of A.
Earnings were strong last quarter. Affiliated Managers Group, Inc. beat our consensus estimate by 1.96%, and for the current fiscal year, AMG is expected to post earnings of $23.33 per share on revenue of $2.06 billion.
Shares of Affiliated Managers Group, Inc. have gained 14.2% over the past month, and currently trade at a forward P/E of 9.03X and a P/CF of 8.56X.
The Financial - Investment Management industry is in the top 11% of all the industries we have in our universe, so it looks like there are some nice tailwinds for FHI and AMG, even beyond their own solid fundamental situation.
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Federated Hermes, Inc. (FHI) Hits Fresh High: Is There Still Room to Run?
A strong stock as of late has been Federated Hermes (FHI - Free Report) . Shares have been marching higher, with the stock up 11.4% over the past month. The stock hit a new 52-week high of $47.3 in the previous session. Federated Hermes has gained 14.5% since the start of the year compared to the 9.2% move for the Zacks Finance sector and the 0.9% return for the Zacks Financial - Investment Management industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, having beaten the Zacks Consensus Estimate in each of the last four quarters. In its last earnings report on April 24, 2025, Federated Hermes reported EPS of $1.1 versus consensus estimate of $0.91 while it beat the consensus revenue estimate by 0.88%.
For the current fiscal year, Federated Hermes is expected to post earnings of $4.37 per share on $1.72 in revenues. This represents a 35.29% change in EPS on a 5.25% change in revenues. For the next fiscal year, the company is expected to earn $4.43 per share on $1.78 in revenues. This represents a year-over-year change of 1.23% and 3.42%, respectively.
Valuation Metrics
Federated Hermes may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
Federated Hermes has a Value Score of A. The stock's Growth and Momentum Scores are C and B, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 10.8X current fiscal year EPS estimates, which is not in-line with the peer industry average of 11.9X. On a trailing cash flow basis, the stock currently trades at 13.3X versus its peer group's average of 12.4X. Additionally, the stock has a PEG ratio of 0.84. This is good enough to put the company in the top echelon of all stocks we cover from a value perspective, making Federated Hermes an interesting choice for value investors.
Zacks Rank
We also need to consider the stock's Zacks Rank, as this is even more important than the company's VGM Score. Fortunately, Federated Hermes currently has a Zacks Rank of #2 (Buy) thanks to a solid earnings estimate revision trend.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Federated Hermes meets the list of requirements. Thus, it seems as though Federated Hermes shares could still be poised for more gains ahead.
How Does FHI Stack Up to the Competition?
Shares of FHI have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Affiliated Managers Group, Inc. (AMG - Free Report) . AMG has a Zacks Rank of #2 (Buy) and a Value Score of A, a Growth Score of C, and a Momentum Score of A.
Earnings were strong last quarter. Affiliated Managers Group, Inc. beat our consensus estimate by 1.96%, and for the current fiscal year, AMG is expected to post earnings of $23.33 per share on revenue of $2.06 billion.
Shares of Affiliated Managers Group, Inc. have gained 14.2% over the past month, and currently trade at a forward P/E of 9.03X and a P/CF of 8.56X.
The Financial - Investment Management industry is in the top 11% of all the industries we have in our universe, so it looks like there are some nice tailwinds for FHI and AMG, even beyond their own solid fundamental situation.