Shares of Affiliated Managers Group AMG have slumped 52.7% year to date compared with the industry’s decline of around 29.4% on rising investors’ concerns over substantial intangible assets on the company’s balance sheet and exposure to high debt obligation.
As of Sep 30, 2018, Affiliated Managers’ intangible assets constituted more than 46% of total assets. As book value of such assets might get damaged, these assets may have to be written down. Further, the company’s long-term debt was nearly $1.8 billion (21.6% of total assets). Notably, high debt level could restrict the company from procuring additional finance for working capital, capital expenditures, acquisitions, debt service requirements or other purposes.
In addition, Affiliated Managers has been witnessing downward revision in EPS estimates. The Zacks Consensus Estimate for EPS of $14.75 for 2018 declined 3.8% over the last 60 days. For 2019, it has moved down by 8.1% to $15.61 during the same time frame.
The stock currently carries a Zacks Rank #4 (Sell). Our research shows that stocks carrying Zacks Rank #4 or 5 (Strong Sell) underperform the market.
You can learn more about the Zacks Rank here >>>
Some Great Picks in the Investment Management Space
Heightening concerns about rising interest rates, trade tensions and political uncertainty have kept the markets under pressure, but the continued economic improvement has been the key offsetting factor.
Similar to many other companies that are suffering from the ongoing broader issues, it may not be easy for investment management companies to produce decent returns in the near future. However, betting on some investment management stocks, which possess robust fundamentals and carry a top Zacks Rank, could be really rewarding.
Here we present three such stocks:
Ashford Inc. AINC sports a Zacks Rank of 1 (Strong Buy). Further, the Zacks Consensus Estimate for 2018 EPS has moved up by 8.6% over the last 60 days. Over the past two years, the company’s shares have gained 17.6%.
You can see the complete list of today’s Zacks #1 Rank stocks here.
Capital Southwest Corporation CSWC flaunts a Zacks Rank of 1. The Zacks Consensus Estimate for the current fiscal year EPS moved up by 12.5% in the past 60 days. Also, shares of the company have climbed 21.3% in the past two years.
OM Asset Management PLC’s BSIG current-year earnings estimate moved up slightly over the last 60 days. As a result, it is carrying a Zacks Rank #2 (Buy). Further, in the past two years, the stock has rallied 5.4%.
In addition to the stocks discussed above, would you like to know about our 10 top tickers to buy and hold for the entirety of 2019?
These 10 are painstakingly handpicked from over 4,000 companies covered by the Zacks Rank. They are our primary picks poised to outperform in the year ahead. Be among the first to see the new Zacks Top 10 Stocks >>
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Affiliated Managers Group, Inc. (AMG) : Free Stock Analysis Report
Capital Southwest Corporation (CSWC) : Free Stock Analysis Report
OM Asset Management PLC (BSIG) : Free Stock Analysis Report
Ashford Inc. (AINC) : Free Stock Analysis Report
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