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5 Reasons That Make Evercore (EVR) a Good Investment Option

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Evercore (EVR - Free Report) seems to be an attractive stock on the back of its top-line strength and solid balance sheet position. Further, its earnings growth prospects and efforts to enhance shareholder value are encouraging.

The company’s Zacks Consensus Estimate for the current-year earnings has been revised 2.7% upward over the last 60 days, indicating analysts’ optimism about its earnings growth potential. As a result, the stock currently flaunts a Zacks Rank #1 (Strong Buy).

Also, Evercore has an impressive earnings surprise history. The bank delivered an average positive earnings surprise of 24.2% in the trailing four quarters.

Given its strong fundamentals, shares of Evercore have rallied 53.6% in the past year, significantly outperforming the industry’s growth of 13.6%. Notably, the stock has a Momentum Score of B. Our research shows that stocks with a Style Score of A or B, when combined with a Zacks Rank #1 or 2 (Buy), offer the best upside potential.

 

Here are the factors that make Evercore an attractive stock:

Earnings per Share Strength: Over the past three to five years, Evercore witnessed earnings per share (EPS) growth of 24.3% compared with the industry’s average of 6.4%. Further, the company’s earnings are projected to rise 40% in 2018.

Also, its long-term (three to five years) estimated EPS growth rate of 15.5% promises rewards for investors over the long run.

Revenue Strength: Evercore’s net revenues have seen a compounded annual growth rate of 17.8% over the last three years (2015-2017). The top-line improvement was backed by strong performance of investment banking segment.

Solid Return on Equity (ROE): With a ROE of 40.9% compared with the industry average of 8.75%, Evercore appears to reinvest its cash more efficiently.

Strong Leverage: Evercore’s debt/equity ratio is valued at 0.22 compared to the industry’s average of 0.23. The relatively strong financial health of the company will help it perform better in an unstable economic environment compared with its peers.

Steady Capital Deployment: Evercore’s ability to generate positive cash flows and enhance shareholder value through regular dividend payments as well as share repurchases is commendable. Notably, in April 2018, the company raised its quarterly cash dividend by 25%.

Other Stocks Worth a Look

Other stocks worth considering in the same industry include LPL Financial Holdings (LPLA - Free Report) and Investment Technology Group , both sporting a Zacks Rank of 1, and Stifel Financial Corporation (SF - Free Report) , carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for LPL Financial’s current-year earnings was revised slightly upward over the last 30 days. Also, its share price has seen a 58.3% rise in the past year.

Investment Technology’s earnings estimates have been revised slightly upward for the current year, over the last 30 days. Also, in the past year, its share price has increased 47.1%.

Earnings estimates for Stifel Financial have moved up 1% for the current year, over the last 30 days. Also, its share price has seen a 17.2% rise in the past year.

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