Lazard Upped to Strong Buy - Analyst Blog

On Dec 24, Zacks Investment Research upgraded Lazard Ltd. LAZ to a Zacks Rank #1 (Strong Buy).

Why the Upgrade?

Lazard continued with its long-term strategy to boost stockholders' return. Further, the company has witnessed positive estimate revisions on the back of strong third-quarter 2013 results. Moreover, the long-term expected earnings growth rate for this stock is 12%.

On Dec 10, Lazard declared a special dividend of 25 cents per share on its outstanding Class A common stock. The dividend will be paid on Dec 27, to shareholders of record as of Dec 20.

Further, Lazard reported third-quarter results on Oct 24 with adjusted earnings per share of 46 cents, beating the Zacks Consensus Estimate by 31.4%. Robust results reflected strong top-line performance. Moreover, Lazard held a strong capital position and higher assets under management (AUM).

In the reported quarter, Lazard's operating revenues, on an adjusted basis, came in at $488.7 million, up 10% from the prior-year quarter. However, higher operating expenses that increased 4.3% year over year to $389.2 million were the downside.

Further, Lazard continued with its share repurchase program and is on track to achieve its cost saving targets.

The Zacks Consensus Estimate for 2013 advanced 4.1% to $1.78 per share over the last 60 days. Also, for 2014, it rose 5.6% to $2.46 per share over the same time frame.

Other Stocks to Consider

Besides Lazard, other investment management firms worth considering include Artisan Partners Asset Management Inc. APAM, Waddell & Reed Financial, Inc. WDR and Virtus Investment Partners, Inc. VRTS. All these stocks carry a Zacks Rank #1 (Strong Buy).