UPDATE: Citigroup Raises PT on Federated Investors on Lowered EPS Estimates

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In a report published Monday, Citigroup analyst William R. Katz reiterated a Buy rating on Federated Investors FII, and raised the price target from $32.00 to $34.00.

In the report, Citigroup noted, “After a deeper review of money market fee waiver dynamics and 2Q retail flows, we are lowering our 2Q13, and full year 2013-15 EPS estimates though we are edging up our 12-month target $2 to $34 as we refine our valuation methodology. We maintain our contrarian Buy rating despite the expected miss as: 1) investors seem to be shrugging off near term misses among rate sensitive names; 2) money market reform pressures appear to be abating, yet short interest remains elevated at ~17%; 3) FII ~3% yield should provide some ST cushion; while, 4) our revised target still points to solid ~15% ETR – though we also appreciate the ‘easier money' has now been made in the stock following the 40%+ YTD gain.”

Federated Investors closed on Friday at $30.37.

Posted In: Analyst ColorPrice TargetAnalyst RatingsCitigroupWilliam R. Katz
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