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Why AllianceBernstein (AB) is Worth Adding to Your Portfolio

Zacks Equity Research

The Finance sector was one of the best performers in the second quarter. So, we thought of bringing up a stock from the sector that reflects strong fundamentals and solid long-term growth prospects.

AllianceBernstein Holding L.P. AB is one such stock that has been witnessing upward estimate revisions, reflecting analysts’ optimism about its growth prospects. Over the last 30 days, the Zacks Consensus Estimate for 2018 and 2019 increased slightly and 1.8%, respectively.

Further, shares of this Zacks Rank #2 (Buy) company have gained 2.5% year to date compared with 10.8% growth registered by the industry. We believe the price trend will continue in the coming days, driven by upbeat analysts’ view and the company’s robust fundamentals.

Notably, this New York-based asset manager has a number of other aspects that make it an attractive investment option.

Earnings Growth: AllianceBernstein witnessed earnings growth of 9.09% in the last three to five years. This earnings momentum is likely to continue in the near term as reflected by the company’s long-term (three to five years) estimated EPS growth rate of 5.54%, which promises rewards for investors over the long run.

Superior Return on Equity (ROE): AllianceBernstein has an ROE of 15.54%, better than the industry average of 13.43%. This shows that the company reinvests its cash more efficiently.

Favorable VGM Score: AllianceBernstein has a VGM Score of ‘A’. Our research shows stocks with a VGM Score of ‘A’ or ‘B’, when combined with a Zacks Rank #1 (Strong Buy) or 2, offer the best upside potential.

Strong Leverage: AllianceBernstein’s debt/equity ratio is 0.00 compared with the industry average of 0.46, indicating relative no debt burden. It highlights the company’s financial stability even in an unstable economic environment.

Other Stocks to Consider 

T. Rowe Price Group, Inc. TROW has been witnessing upward estimate revisions for the past 30 days. Moreover, this Zacks #1 Ranked stock has rallied more than 19% year to date. You can see the complete list of today’s Zacks #1 Rank stocks here.

Federated Investors FII has been witnessing upward estimate revisions for the past 30 days. Further, the company’s shares have gained 25.3% year to date. At present, it flaunts a Zacks Rank of 1.

Ameriprise Financial, Inc. AMP has been witnessing upward estimate revisions for the past 30 days. Additionally, the stock has jumped around 29.3% year to date. It currently carries a Zacks Rank #2.

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AllianceBernstein Holding L.P. (AB) : Free Stock Analysis Report
Ameriprise Financial, Inc. (AMP) : Free Stock Analysis Report
T. Rowe Price Group, Inc. (TROW) : Free Stock Analysis Report
Federated Investors, Inc. (FII) : Free Stock Analysis Report
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