Lazard LTD. Lazard, LTD. (LAZ) stock forecast and price target

Stocks continued to fall last week, as any positive earnings-related news was overwhelmed by issues that include offsetting disappointing earnings, interest rates, Treasury yields, and volatile geopolitical developments. Turning our attention to insider-sentiment data from Vickers Stock Research, transaction volume remains historically low (and therefore less meaningful) as insiders are broadly sidelined by trading restrictions currently in place. Add it all up, and it is easy to assume there is nothing of interest in Vickers' data this week.

Small- and mid-cap stocks (SMID) have underperformed large-caps over the past 12 months, but may be in a better position to generate market-beating returns going forward. SMID companies tend to focus on domestic markets, so their businesses could be less disrupted by the fallout from the Russian invasion of Ukraine, high European inflation or other geopolitical developments. As well, the prices of SMID stocks generally are lower than the prices of large-caps. SMID stocks can be risky, but diversified investors look to have exposure to small- and mid-caps based on the long-term performance record. We estimate that 12%-15% of the U.S. stock market's capitalization is comprised of SMID stocks. For our purposes, we use a threshold of $20 billion to define a SMID stock.

Stocks fell on Friday morning following the start of a UAW strike against the Big Three automakers, which could lower inventories and raise prices for both cars and parts. The strike is the first to target all three companies at once. However, it is not a full-scale walkout and will initially involve less than 13,000 of the UAW's roughly 150,000 members. On the earnings front, Adobe shares fell 4% despite solid fiscal 3Q results amid concerns about soft sales in the current fourth quarter. The Dow fell 0.4%, the S&P 0.6%, and the Nasdaq 0.9%. Crude oil traded near $90 per barrel, while gold rose $19 to $1952 per ounce.

Value stocks -- a market segment that includes high-yield stocks -- outperformed growth stocks in 2022 for the first time since 2016. Indeed, for the past decade, the performance record has favored growth. But the tide turned in 2022. The rollout of COVID-19 vaccines gave a lift to some of the cyclical companies (energy companies and regional banks) that had lagged in recent quarters, and value stocks outpaced growth stocks over the past year. Meanwhile, the Federal Reserve continues to lift interest rates to fend off inflation, which could possibly cap multiple expansion for growth companies for a few more quarters. Regardless, the value sector is the place to achieve income. The current yield on the iShares Russell 1000 Value Index ETF is 2.2%, compared to the 0.9% current yield on the iShares Russell 1000 Growth Index ETF. For our High-Yield Theme Model Portfolio, we are seeking stocks with yields of at least 3.0%. This moves us deep into the value segment of the market.

Value stocks -- a market segment that includes high-yield stocks -- outperformed growth stocks in 2022 for the first time since 2016. Indeed, for the past decade, the performance record has favored growth. But the tide turned in 2022. The rollout of COVID-19 vaccines gave a lift to some of the cyclical companies (energy companies and regional banks) that had lagged in recent quarters, and value stocks outpaced growth stocks over the past year. Meanwhile, the Federal Reserve continues to lift interest rates to fend off inflation, which could possibly cap multiple expansion for growth companies for a few more quarters. Regardless, the value sector is the place to achieve income. The current yield on the iShares Russell 1000 Value Index ETF is 2.2%, compared to the 0.9% current yield on the iShares Russell 1000 Growth Index ETF. For our High-Yield Theme Model Portfolio, we are seeking stocks with yields of at least 3.0%. This moves us deep into the value segment of the market.

Stocks fell in late trading on Thursday, giving up early gains, as investors weighed more 2Q earnings reports and new GDP and employment data. The Commerce Department, in its advance estimate, said that the U.S. economy expanded at a 2.4% annualized rate in 2Q23, up from a revised 2.0% in 1Q and above the Bloomberg consensus forecast of 1.8% growth. On the employment front, first-time claims for state unemployment benefits fell by 7,000 to a seasonally adjusted 221,000 for the week ended July 22, below the Bloomberg consensus of 235,000. Continuing claims fell by 59,000 to 1.69 million. The Dow fell 0.67%, the S&P 0.64%, and the Nasdaq 0.55%. Crude oil rose more than 1% to $80 per barrel, while gold fell $26 to $1944 per ounce.

Stocks fell sharply on Tuesday morning, led by declines in regional bank stocks. Treasury Secretary Janet Yellen warned that the U.S. government could run out of funding by June 1, earlier than previously expected, if Congress fails to raise the debt ceiling. Employment data pointed to a cooling labor market. In its monthly JOLTS survey, the Labor Department said that U.S. job openings dropped to 9.59 million on the last day of March, below the Reuters consensus forecast of 9.78 million and the third straight monthly decline. The Dow fell 1.6%, the S&P 1.6%, and the Nasdaq 1.4%. Crude oil traded near $72 per barrel, while gold jumped $26 to $2018 per ounce.

Small- and mid-cap stocks (SMID) have underperformed large-caps over the past 12 months, but may be in a better position to generate market-beating returns going forward. SMID companies tend to focus on domestic markets, so their businesses could be less disrupted by the fallout from the Russian invasion of Ukraine, high European inflation or other geopolitical developments. As well, the prices of SMID stocks generally are lower than the prices of large-caps. SMID stocks can be risky, but diversified investors look to have exposure to small- and mid-caps based on the long-term performance record. We estimate that 12%-15% of the U.S. stock market's capitalization is comprised of SMID stocks. For our purposes, we use a threshold of $15 billion to define a SMID stock.

Small- and mid-cap stocks (SMID stocks) have underperformed large-caps over the past 12 months, but may be in a better position to generate market-beating returns going forward. For one thing, SMID companies tend to focus on domestic markets, so their businesses could be less disrupted by the fallout from the Russian invasion of Ukraine, high European inflation, and other geopolitical developments. As well, the prices of SMID stocks generally are lower than the prices of large-caps, with the P/E ratio on the Russell 2000 Small-Cap Index at 11 compared to a trailing P/E of 20 for the S&P 500. Finally, the long-term record has favored SMID stocks over large-caps. From 2003-2022, the Russell 2000 Index climbed 470%, compared to an advance of 444% for the S&P 500 index. Here are the stocks with market caps below $15 billion that are on the Argus BUY list and have been added to our Mid-Cap Theme Model Portfolio.

Value stocks -- a market segment that includes high-yield stocks -- outperformed growth stocks in 2022 for the first time since 2016. Indeed, for the past decade, the performance record has favored growth. But the tide turned in 2022. The rollout of COVID-19 vaccines gave a lift to some of the cyclical companies (energy companies and regional banks) that had lagged in recent quarters, and value stocks outpaced growth stocks over the past year. Meanwhile, the Federal Reserve continues to lift interest rates to fend off inflation, which could possibly cap multiple expansion for growth companies for a few more quarters. Regardless, the value sector is the place to achieve income. The current yield on the iShares Russell 1000 Value Index ETF is 2.2%, compared to the 0.9% current yield on the iShares Russell 1000 Growth Index ETF. For our High-Yield Theme Model Portfolio, we are seeking stocks with yields of at least 3.0%. This moves us deep into the value segment of the market.

Monday Tee Up: Heavy on Earnings, Light on the Economy

Monday Tee Up: The Fed, Jobs, Earnings Roll On

Monday Tee-Up: No Summer Doldrums on Wall Street

The Portfolio Selector features the Argus Focus List, a group of 30 "best idea" stocks generated and regularly updated by Argus' analysts and investment policy committee. It also includes the director of research’s monthly investment strategy column, stock recommendations and sector picks, economic forecasts, and an asset allocation model. This month, the Focus List additions are AbbVie Inc (ABBV); Monster Beverage Corp. (MNST); ASML Holding NV (ASML); Sempra Energy (SRE); Morgan Stanley (MS) and the Focus List deletions are Sysco Corp. (SYY); Lam Research Corp. (LRCX); Lazard Ltd. (LAZ); Moderna Inc (MRNA).

The Vickers Top Buyers & Sellers is a daily report that identifies the five companies the largest insider purchase transactions based on the dollar value of the transactions as well as the five companies the largest insider sales transactions based on the dollar value of the transactions.

Stocks rose on Thursday morning amid earnings reports from major technology companies and new GDP data. The Commerce Department said that the U.S. economy contracted at a 1.4% annualized rate in the first quarter, driven mainly by a wider trade deficit, down from 6.9% growth in 4Q and below the Reuters consensus forecast, which called for growth of 1.1%. The Dow rose 0.4%, the S&P 0.8%, and the Nasdaq 0.6%. Crude oil rose nearly 2% to $104 per barrel, while gold fell slightly to $1890 per ounce.

Our rating on the Financial Services sector is Over-Weight. Based on positive vaccine developments and actions from the administration in Washington, interest rates have started to move higher at the long end of the yield curve. We expect banks to benefit from wider net interest margins and lower loan-loss provisions as the economy normalizes. We also expect insurance companies to generate higher income in their investment portfolios. The sector accounts for 10.7% of the S&P 500, down from 16.3% following the exclusion of Real Estate stocks. Over the past five years, the weighting has ranged from 9% to 17%. We think the sector should account for 11%-12% of diversified portfolios. Here is how we use our analysts' Financial Services sector ideas in our Focus List and Model Portfolios. All of the following stocks currently are rated BUY at Argus.

Stocks were mixed on Friday morning following a strong monthly employment report. The Labor Department said that the U.S. economy added 467,000 payroll jobs in January, well above the consensus forecast of 125,000. The report also showed a strong increase in December payrolls, which were revised up to 510,000 from the 199,000 reported last month. The official unemployment rate edged up to 4.0% from 3.9% in December. The Dow fell 0.3%, the S&P was flat, and the Nasdaq rose 0.8%. Crude oil jumped to nearly $93 per barrel, while gold traded near $1808 per ounce.

Our proprietary Treasury Bond Yield Model is signaling that bond yields are too low based on the investment fundamentals. Our model takes into account factors such as current yields, GDP growth, long-term inflation, as well as stock prices and earnings, in order to make an asset-allocation recommendation between stocks and bonds. We smooth trends out over a five-year period to avoid short-term momentum swings. Our current 10-year T-bond fair value yield is 3.9%. The normal valuation range has a floor of 2.1% and a ceiling of 4.7%. The current 10-year bond yield is around 1.45%, below the low end of the fundamental range and about 50% below fair value. Why is this the case (especially given recent GDP growth and inflation trends, not to mention aggressive fiscal stimulus spending from Washington during the pandemic)? In our view, the low U.S. yields more likely reflect technical factors such as heavy buying from overseas investors seeking safety (or at least, yields that are not below zero), rather than economic fundamentals. From an asset-allocation standpoint, we still think bonds remain fully valued compared to stocks and recommend that long-term investors modestly favor equities in diversified portfolios.

Argus has published its latest Portfolio Selector, which features its popular Focus List. Each month, Director of Research Jim Kelleher, CFA, surveys the team of Argus Research industry analysts for their timeliest recommendations out of the company's fundamental universe of approximately 500 stocks. The Focus List typically includes 30 stocks: turnover is high, as Jim typically adds three or four new stocks per month. Below are the latest additions, all of which are rated BUY at Argus Research.

The Portfolio Selector features the Argus Focus List, a group of 30 "best idea" stocks generated and regularly updated by Argus' analysts and investment policy committee. It also includes the director of research’s monthly investment strategy column, stock recommendations and sector picks, economic forecasts, and an asset allocation model. This month, the Focus List additions are Laboratory Corp. Of America Hl (LH); AECOM (ACM); Lazard Ltd. (LAZ); Netflix Inc (NFLX) and the Focus List deletions are Charter Communications Inc. (CHTR); General Dynamics Corp. (GD); Raymond James Financial, Inc. (RJF); Silk Road Medical Inc (SILK).

The market ain't afraida' no ghosts, and stocks sailed into Halloween weekend flying high on a witch's broom. The S&P 500, assigned to Dracula's coffin in September, rose up to reach an all-time intra-day high at 4,608 on October 29 before finishing the session an all-time closing high of 4,605.

The Portfolio Selector features the Argus Focus List, a group of 30 "best idea" stocks generated and regularly updated by Argus' analysts and investment policy committee. It also includes the director of research’s monthly investment strategy column, stock recommendations and sector picks, economic forecasts, and an asset allocation model. This month, the Focus List additions are Bank of New York Mellon Corp (BK); Alphabet Inc (GOOGL); Emerson Electric Co. (EMR); TJX Companies, Inc. (TJX) and the Focus List deletions are D.R. Horton Inc. (DHI); Activision Blizzard Inc (ATVI); Trane Technologies plc (TT); Lazard Ltd. (LAZ).

The stock market was flat to down last week as positive earnings surprises proved to be baked-in. Tech stocks modestly underperformed blue chips. During Friday's session, the Dow Jones Industrial Average fell 149 points, or 0.42%. The S&P 500 was down 0.54%, and the Nasdaq Composite was down 0.71%. For the week, the DJIA was down 126 points, or 0.36%, the S&P 500 was down 0.37%, and the Nasdaq Composite was down 1.11%. Year-to-date, the DJIA is up 14.14%, the S&P 500 is up 17.02%, and the Nasdaq Composite is up 13.85%.

Our proprietary Treasury Note Yield Model is signaling that bond yields, which have declined 25 basis since late March, remain too low based on the fundamentals. Our model discounts factors such as current yields, GDP growth and long-term inflation, as well as stock prices and earnings. We smooth trends out over a five-year period, in order to avoid short-term momentum swings. Our current 10-year T-bond fair value yield is 3.4%. The normal valuation range has a floor of 2.1% and a ceiling of 4.7%. The current 10-year bond yield is around 1.5%, below the low end of the fundamental range and well below fair value. From an asset-allocation standpoint, we think bonds remain fully valued compared to stocks and recommend that long-term investors modestly favor equities in their diversified portfolios. We typically break the fixed-income portfolio component into four areas: Core, such as the industry benchmark ETF AGG or Treasuries; Inflation-Indexed; Opportunistic, such as securitized debt, corporate debt, high-yield or floating bonds or preferreds; and Cash. We currently favor the Core and Opportunistic segments, and have been adding to Inflation-Indexed. On duration, we recommend the intermediate-term.

Our rating on the Financial Services sector is Over-Weight. With market optimism rising on positive vaccine developments and the new administration in Washington, interest rates have started to move higher at the long end of the yield curve. We expect banks to benefit from wider net-interest margins and lower loan-loss provisions as the economy normalizes, and insurance companies to generate higher income in their investment portfolios. The sector now accounts for 11.4% of the S&P 500. Over the past five years, the weighting has ranged from 10% to 17%. We think the sector should account for 12%-15% of diversified portfolios. Here is how we use our analysts' Financial Services sector ideas in our Focus List and Model portfolios. All of the following stocks are rated BUY at Argus.

The stock market was flat to down last week. Tech stocks and blue chips performed similarly, with tech narrowly outperforming. During Friday's session, the Dow Jones Industrial Average fell 186 points, or 0.54%. The S&P 500 was down 0.72%, and the Nasdaq Composite was down 0.85%. For the week, the DJIA was down 169 points, or 0.50%, the S&P 500 was up 0.02%, and the Nasdaq Composite was down 0.39%. Year-to-date, the DJIA is up 10.68%, the S&P 500 is up 11.32%, and the Nasdaq Composite is up 8.34%.

Our proprietary Treasury Note Yield Model is signaling that bond yields are still too low based on the fundamentals. Our model discounts factors such as current yields, GDP growth and long-term inflation, as well as stock prices and earnings. We smooth trends out over a five-year period, in order to avoid short-term momentum swings. Our current 10-year T-bond fair value yield is 3.0%. The normal valuation range has a floor of 1.75% and a ceiling of 4.25%. The current 10-year bond yield is around 1.55%, below the low end of the fundamental range and well below fair value. From an asset-allocation standpoint, we think bonds remain fully valued compared to stocks and recommend that long-term investors modestly favor equity securities in their diversified portfolios. We typically break the fixed-income portfolio component into four areas: Core, such as the industry benchmark ETF AGG or Treasuries; Inflation-Indexed; Opportunistic, such as securitized debt, corporate debt, high-yield or floating bonds or preferreds; and Cash. We currently favor the Core and Opportunistic segments, and have been adding to Inflation-Indexed. On duration, we recommend the intermediate-term.

Our proprietary Treasury Note Yield Model is signaling that bond yields, which have climbed 70 basis points year-to-date, are still too low based on the fundamentals. Our model discounts factors such as current yields, GDP growth and long-term inflation, as well as stock prices and earnings. We smooth trends out over a five-year period, in order to avoid short-term momentum swings. Our current 10-year T-bond fair value yield is 3.0%. The normal valuation range has a floor of 1.75% and a ceiling of 4.25%. The current 10-year bond yield is around 1.6%, below the low end of the fundamental range and well below fair value. From an asset-allocation standpoint, we think bonds remain fully valued compared to stocks and recommend that long-term investors modestly favor equities in diversified portfolios. We typically break the fixed-income portfolio component into four areas: Core, such as the industry benchmark ETF AGG or Treasuries; Inflation-Indexed; Opportunistic, such as securitized debt, corporate debt, high-yield or floating bonds or preferreds; and Cash. We favor the Core and Opportunistic segments, and have been adding to Inflation-Indexed. On duration, we recommend the intermediate-term.

Argus Research has published its latest Portfolio Selector, which features its popular Focus List. Each month, Director of Research Jim Kelleher, CFA, surveys the team of Argus industry analysts for their timeliest recommendations out of the company's fundamental universe of approximately 500 stocks. The Focus List typically includes 30 stocks: turnover is high, as Director of Research Kelleher typically adds three or four new stocks per month. Below are the latest additions, all of which are rated BUY at Argus.

The Portfolio Selector features the Argus Focus List, a group of 30 "best idea" stocks generated and regularly updated by Argus' analysts and investment policy committee. It also includes the director of research’s monthly investment strategy column, stock recommendations and sector picks, economic forecasts, and an asset allocation model. This month, the Focus List additions are Lazard Ltd. (LAZ); KLA Corp. (KLAC); Silk Road Medical Inc (SILK); Pinterest Inc (PINS) and the Focus List deletions are Citizens Financial Group Inc (CFG); Moderna Inc (MRNA); Verizon Communications Inc (VZ); Western Digital Corp. (WDC).

Last week, we noted that insider-sentiment data from Vickers Stock Research turned benign after two weeks of intensely bearish readings. During those two dark weeks, the big financial-press headlines (though certainly not the only headlines) focused on the GameStop short squeeze and fears of a broader market meltdown. Trading action saw the Dow Jones Industrial Average fall to a weekly close of 29,982 from 31,097 only a few weeks earlier.

Stocks rose on Thursday morning, recovering some of their losses after Wednesday's sharp selloff. GDP data was strong. The Commerce Department said that the U.S. economy expanded at a 33.1% annualized rate in the third quarter, a reversal from the 2Q decline of 31.4%. The reading was also above the Bloomberg consensus forecast of 32.0%. On the employment front, the Labor Department said that initial claims for state unemployment benefits fell to 751,000 for the week ended October 24, down from 791,000 a week earlier and below the Bloomberg consensus forecast of 770,000. The Dow rose 0.4%, the S&P 1.0%, and the Nasdaq 1.5%. Crude oil fell more than 3% to $36 per barrel, while gold fell $8 to $1872 per ounce.

Much of the weekly data from Vickers Stock Research suggests that things are pretty much as expected in the world of insider transactions. Earnings season is still underway and the volume of insider transactions is therefore low. As well, most of Vickers' insider indexes and insider sell/buy ratios are either neutral or slightly bearish. That makes sense as insiders jumped in when stock prices cratered on COVID-19 fears, and those same insiders have pulled back as stocks have rebounded. So is there anything of note in current insider activity? Why yes there is.

April was almost -- but not quite -- in the books when the hopeful sentiment that lifted stocks began to fade. Now, May lies ahead and many-times burned investors are wondering, again, if they should sell in May and go away.

April was almost -- but not quite -- in the books when the hopeful sentiment that lifted stocks began to fade. Now, May lies ahead and many-times burned investors are wondering, again, if they should sell in May and go away.

Lazard has a storied history that can be traced back to 1848. The company's revenue is nearly equally split between financial advisory, such as acquisition and restructuring advisory, and asset management. The company's asset management business is primarily equities (over 80% of assets under management), has an international focus, and is geared toward institutional clients. By geography, the company earns approximately 60% of revenue in the Americas, 30% in EMEA, and 10% in Asia-Pacific. Lazard has offices in over 40 cities across more than 25 countries and over 2,900 employees.

The S&P 500 fell 0.2% in January, after taking a late-month haircut. The index was up 3% on January 17, but the coronavirus and profit taking hurt late in the month. Since we last looked at the S&P 500 sectors at the end of December, there have been both bullish and bearish signs in early 2020. There was some higher-beta/growth leadership; but there also was some defensive sector leadership. We think the defensive strength came directly from the nice rally in bonds as the 10-year Treasury yield fell to 1.52% from 1.92% in January.

The S&P 500 fell 0.2% in January, after taking a late-month haircut. The index was up 3% on January 17, but the coronavirus and profit taking hurt late in the month. Since we last looked at the S&P 500 sectors at the end of December, there have been both bullish and bearish signs in early 2020. There was some higher-beta/growth leadership; but there also was some defensive sector leadership. We think the defensive strength came directly from the nice rally in bonds as the 10-year Treasury yield fell to 1.52% from 1.92% in January.

April was almost -- but not quite -- in the books when the hopeful sentiment that lifted stocks began to fade. Now, May lies ahead and many-times burned investors are wondering, again, if they should sell in May and go away.