Given its focus on fortifying business through several planned initiatives such as launching investment strategies and vehicles, enhancing client-engagement capabilities in each distribution channel, strengthening distribution channels in the United States., EMEA, and Asia Pacific and improving its technology platform, T. Rowe Price Group, Inc. (TROW - Free Report) appears to be a solid bet. The company’s mix shift toward international growth funds and debt-free position are anticipated to drive the stock.
Though T. Rowe Price’s expenses might escalate due to potential investments in technology and several planned strategic initiatives, sharper focus on organic growth is anticipated to make growth path smoother for the company.
T. Rowe Price has been witnessing upward estimate revisions, reflecting analysts’ optimism about its future prospects. Over the past 30 days, the Zacks Consensus Estimate for 2019 and has 2020 inched up 1.3% and 1.2%, respectively.
Further, this Zacks Rank #2 (Buy) stock has gained 16.3% in the past three months.
There are also a number of other aspects which make the stock an attractive investment option.
5 Reasons Why T. Rowe Price is a Golden Egg
Revenue Growth: Organic growth remains a key strength at T. Rowe Price, as reflected in its revenue growth story. Net revenues have demonstrated 7.8% CAGR, over the last five years (2014-2018).
Earnings Per Share Strength: T. Rowe Price witnessed earnings growth of 10.4%, over the last three-five years. In addition, the company’s long-term (three-five years) estimated EPS growth rate of 8.34% promises rewards for investors over the long run.
Steady Capital Deployment: In February 2019, the company raised its quarterly common stock dividend by 8.6%. This marked T. Rowe Price’s 33rd consecutive annual dividend increase and reflected its commitment to return value to shareholders with strong cash-generation capabilities. Further, its board of directors increased the common share-repurchase authorization by 10 million shares, bringing the total authorization to about 22.4 million shares.
Strong Leverage: T. Rowe Price’s debt/equity ratio is 0.00 compared with the industry average of 0.24, displaying no debt burden relative to the industry. It highlights the financial stability of the company even in an unstable economic environment.
Superior Return on Equity (ROE): T. Rowe Price’s ROE of 29.16%, compared with the industry average of 13.85%, indicates the company’s commendable position over its peers.
Other Stocks to Consider
E*TRADE Financial Corporation (ETFC - Free Report) has been witnessing upward estimate revisions for the past 60 days, with the company’s shares rising nearly 10.7%, in three months’ time. It holds a Zacks Rank of 2, at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Fifth Third Bancorp (FITB - Free Report) has been witnessing upward estimate revisions for the past 60 days. Over the past three months, this Zacks #2 Ranked company’s shares have been up more than 8%.
Franklin Resources, Inc. (BEN - Free Report) has been witnessing upward estimate revisions for the past 60 days. In the past three months, this Zacks Rank #2 company’s shares have been up more than 15%.
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