Skip to main content

Market Overview

Raymond James: Focus Financial 'A Unique Investment Opportunity'

Raymond James: Focus Financial 'A Unique Investment Opportunity'

Focus Financial Partners Inc (NASDAQ: FOCS), which recently offered 16.22 million shares in an IPO, has seen its shares trade at a premium to its offer price of $33 since it listed July 26.

The company is a wealth management firm operating in the registered investment advisor industry.

The Analyst

Raymond James analyst Patrick O'Shaughnessy initiated coverage of Focus Financial with an Outperform rating and $43 price target.

The Thesis

Focus Financial's leadership position among RIA consolidators means a superior cost of capital in financing acquisitions, as well as the scale and talent to execute on its strategy, O'Shaughnessy said in a Monday note. (See the analyst's track record here.) 

The analyst believes the company can generate double-digit revenue growth due to a large pipeline of potential acquisition candidates.

The company's focus primarily on fee-based revenues adds "stability to the business model and [avoids] potential conflicts of interest arising from commissions," O'Shaughnessy said. 

Market appreciation has been responsible for a substantial portion of Focus Financial's five-year organic CAGR of 19 percent, the analyst said — meaning any market downturn could pose a meaningful headwind.

Raymond James introduced a non-GAAP EPS estimate of $1.73 for 2018 and $2.30 for 2019.

"Although there are some areas of uncertainty facing investors, including the sustainability of organic growth and the outlook for acquisition multiples, Focus is a unique investment opportunity with a track record of double-digit revenue and earnings growth and we view the risk-reward as attractive." 

The Price Action

Since its listing, Focus Financial stock has gained about 2.5 percent.

Related Links:

The Future Of The Innovative Digital RIA Firm: Infrastructure Ownership & Retire On Track

Analysts Break Down The Best Discount Brokers Heading Into Q1 Earnings

Latest Ratings for FOCS

Feb 2021Credit SuisseMaintainsOutperform
Feb 2021Goldman SachsMaintainsBuy
Jan 2021Raymond JamesMaintainsOutperform

View More Analyst Ratings for FOCS
View the Latest Analyst Ratings


Related Articles (FOCS)

View Comments and Join the Discussion!

Posted-In: Patrick O'Shaughnessy Raymond JamesAnalyst Color Price Target Initiation Analyst Ratings Best of Benzinga

Latest Ratings

ICADGuggenheimInitiates Coverage On24.0
SMBKRaymond JamesUpgrades27.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Everything you need to know about the latest SPAC news.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at