Broadridge Financial Solutions, Inc. BR yesterday announced that it has completed the acquisition of Financial Database Services — a provider of compensation management, compliance and advisor onboarding solutions for the wealth management industry. The financial terms of the deal have been kept under wraps.
So far this year, shares of Broadridge have gained 33.4% compared with 28.4% rise of the industry it belongs and 15.4% rally of the Zacks S&P 500 composite.
A Strategic Move to Ramp Up Wealth Management Services
The acquisition will help Broadridge amplify its advisor compensation management capabilities, thereby highlighting its focus on delivering value-added technology solutions to the wealth management industry.
It will enhance Broadridge's potential in helping clients with adoption and compliance, considering the recently adopted Regulation Best Interest rule by the U.S. Securities and Exchange Commission.
We believe the move will help Broadridge strengthen its Global Technology and Operations segment, which serves capital markets, wealth management and asset management firms. Revenues from the segment increased 8.2% year over year in fourth-quarter fiscal 2019.
Michael Alexander, head of North American Wealth and Capital Markets Solutions at Broadridge stated, "The acquisition of Financial Database Services is the latest example of Broadridge expanding our wealth capabilities and growing our client base."
Zacks Rank & Stocks to Consider
Broadridge currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some better-ranked stocks in the broader Zacks Business Services sector are FLEETCOR FLT, Huron Consulting HURN and Charles River Associates CRAI, each carrying a Zacks Rank #2 (Buy). Long-term expected earnings (three to five years) growth rate for FLEETCOR, Huron Consulting and Charles River Associates is 15.6%, 13.5% and 13%, respectively.
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