Is Pioneer Select Mid Cap Growth A (PGOFX) a Strong Mutual Fund Pick Right Now?
SEI Investments Co. SEIC boasts a diversified product and revenue mix as well as a strong global presence. Also, enhanced capital deployment activities boost investors’ confidence.
A positive trend in estimate revisions reflect optimism over the company’s earnings growth prospects. The company has seen the Zacks Consensus Estimate for its current-year earnings being revised marginally upward over the last 60 days. As a result, the stock currently carries a Zacks Rank #2 (Buy).
Also, its shares have gained 15.8% in the past year, outperforming the industry’s rally of 5.1%.
Why SEI Investments is an Attractive Choice
Earnings strength: SEI Investments recorded an earnings growth rate of 13% over the last three to five years compared with 4% rise for the industry it belongs to. The earnings growth rate for 2018 and 2019 is anticipated to be 35.3% and 4.4%, respectively, ensuring continued momentum.
Also, SEI Investments has a decent earnings surprise history. The bank delivered an average positive earnings surprise of 5.2% in the trailing four quarters.
Further, the company’s long-term (three-five years) estimated EPS growth rate of 12% promises rewards for investors in the long run.
The stock also has a Growth Score of B. Our research shows that stocks with a Style Score of A or B when combined with a Zacks Rank #1 (Strong Buy) or 2 offer the best upside potential.
Revenue growth: SEI Investments has been witnessing consistent improvement in revenues for the past few years. Over the last six years (2012-2017), the company’s revenues witnessed a CAGR of 9%. Its projected sales growth rate of 6.4% and 4.2% for 2017 and 2018, respectively, ensures continuation of the upward trend in top line.
Robust asset base: Asset inflows at SEI Investments remain strong. The company witnessed a rising trend in its total assets under management and administration over the last four years at a CAGR of 10.1% (2014-2017). Though the overall equity market remains volatile, this investment manager is well positioned to benefit from the same.
Steady capital deployment: SEI Investments continues to impress with its enhanced capital deployment activities. In May 2018, it authorized additional $200 million share buyback plan, while in December 2017, the company hiked its semi-annual dividend by 7.1%. Driven by a strong balance sheet position, it is expected to continue deploying capital meaningfully.
Strong Leverage: SEI Investments has a debt/equity ratio of 0.01 compared with the industry’s average of 0.23. This reflects the relatively strong financial health of the company, which will help it perform better than its peers under a dynamic business environment.
Favorable ROE: SEI Investments’ return on equity (ROE) supports its growth potential. Its ROE of 29.07% compares favorably with the industry’s average ROE of 12.95%, implying its efficiency in using shareholders’ funds.
Other Stocks to Consider
Some other top-ranked stocks in the same space are Prospect Capital Corporation PSEC, T. Rowe Price Group, Inc. TROW and The Carlyle Group L.P. CG. All these stocks carry a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Prospect Capital Corporation has witnessed an upward earnings estimate revision of 2.7% for 2018, over the past 60 days. Its share price has risen 1.8% in the past three months.
For T. Rowe Price, over the past 60 days, the Zacks Consensus Estimate has been revised marginally upward for 2018. Its share price has increased 7.7% in the past three months.
Current-year earnings estimates for Carlyle Group have remained stable, over the past 60 days. In the past three months, its share price has jumped 6.9%.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
T. Rowe Price Group, Inc. (TROW) : Free Stock Analysis Report
The Carlyle Group L.P. (CG) : Free Stock Analysis Report
SEI Investments Company (SEIC) : Free Stock Analysis Report
Prospect Capital Corporation (PSEC) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research