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Broadridge, Preqin Partner to Aid Institutional Asset Managers

Zacks Equity Research

Broadridge Financial Solutions, Inc. BR recently announced that it has inked a deal with Preqin, a U.K.-based provider of financial data and information to the alternative assets market.

Preqin’s data comprises intelligence on roughly $10.42 trillion of assets in private equity, venture capital, hedge funds, real estate, infrastructure, private debt and natural resources.

We observe that shares of Broadridge have gained 33.8% so far this year compared with 29.7% and 16.5% rally of the industry and Zacks S&P 500 composite, respectively.


Deal Details & Benefits                           

The deal will see the integration of Preqin's private market data into Broadridge’s distribution data and analytics platform that offers global mutual fund and ETF distribution data to help asset managers manage asset flows, measure market share, identify opportunities and benchmark sales performance across global markets.

The new offering will feature comprehensive asset and flow data across all global funds, and an expanded institutional view encompassing detailed private fund market analytics, along with segregated accounts, CITs and other pooled products by institutional channels and client types. 

It will offer a unified and holistic view of public and private global capital allocations and asset flows, enabling institutional investors and asset managers to improve decision making about their portfolios.

Considering the three-fold growth rate of alternative assets since 2008, we believe the latest deal is a strategic business move on Broadridge's part.

Frank Polefrone, Broadridge's head of global insights, stated, "As institutional asset owners increase allocations to alternative products, asset managers are interested in analyzing capital flows for both traditional and alternative asset classes across channels.”

We believe that the move will help Broadridge strengthen the Investor Communication Solutions segment, which offers Bank/Broker-Dealer Investor Communication, Customer Communication, Advisor, Corporate Issuer, and Mutual Fund and Retirement Solutions. Third-quarter fiscal 2019 revenues from the segment increased 19% from the year-ago level to $1 billion.

Zacks Rank & Stocks to Consider

Broadridge currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

A few top-ranked stocks in the broader Zacks Business Services sector are Navigant Consulting NCI, NV5 Global NVEE and FLEETCOR Technologies FLT. While Navigant Consulting sports a Zacks Rank #1, both FLEETCOR and NV5 Global carry a Zacks Rank #2 (Buy).

Long-term expected EPS (three to five years) growth rate for Navigant Consulting, FLEETCOR and NV5 Global is 13.5%, 15.4% and 20%, respectively.

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