Waddell & Reed Financial Inc. (WDR) Volatility Spurs A Quest For Clarity

    SBUX Stock
    SBUX Stock

    The Vanguard Group, Inc. recently announced the acquisition of new stake in Waddell & Reed Financial Inc. (NYSE:WDR). The institutional investor has increased its shareholding in the Financial company by 3.96% to 7.44 million shares with purchase of 0.28 million shares. This fresh investment now brings its stake to 11.34% valued currently at $115.46 million. In addition, Burgundy Asset Management Ltd. raised its holdings by 1.38 million to 4.36 million shares. And SSgA Funds Management, Inc. has lifted its position by 5.96% or 0.14 million shares – to 2.49 million shares.

    With over 1.69 million Waddell & Reed Financial Inc. (WDR) shares trading Tuesday and a closing price of $14.66 on the day, the dollar volume was approximately $24.73 million. The shares have shown a negative weekly performance of -5.17% and its price on 07/28/20 lost nearly -3.74%. Currently, there are 67.68M common shares owned by the public and among those 63.16M shares have been available to trade.

    An analysis of what Wall Street brokers have to say about the expected price targets for this stock gives us this picture: 8 analysts who have offered their price forecasts for WDR have a consensus price objective of $14.07. The analysts have set the share’s price value over the next 12 months at a high of $17.00 and a low of $11.50 should the stock experience a downside. Incidentally, analysts’ outlook for the Waddell & Reed Financial Inc. stock is 3.90 for the next 12 months. The average price target is -4.19% below its last price level and a downside to the estimated low will see the stock lose -27.48% over that period. But an upside of 13.76% will see the stock hit the forecast high price target while mean target price for the stock is $14.00.

    Insiders at the company have transacted a total of 48 times over the past 12 months, according to data filed with the U.S. Securities and Exchange Commission (SEC). 25 of these insider trades were purchases, accounting for 721,129 shares. Insider sales of the common stock occurred on 23 occasions, with total insider shares sold totaling 141,328 shares.

    The top 3 mutual fund holders in Waddell & Reed Financial Inc. are iShares Core S&P Small Cap ETF, Fidelity Low Priced Stock Fund, and Stichting Pensioenfonds ABP (Glob. iShares Core S&P Small Cap ETF owns 4.05 million shares of the company’s stock, all valued at over $62.75 million. Fidelity Low Priced Stock Fund sold 12405.0 shares to see its total holdings shrink to 2.43 million shares valued at over $37.7 million and representing 3.70% of the shares outstanding. Stichting Pensioenfonds ABP (Glob sold 5552.0 shares to bring its total holdings to over 2.22 million shares at a value of $34.36 million. Stichting Pensioenfonds ABP (Glob now owns shares totaling to 3.38% of the shares outstanding.

    Shares of Waddell & Reed Financial Inc. (NYSE: WDR) opened at $14.85, down -$0.38 from a prior closing price of $15.23. However, the script later closed the day at $14.66, down -3.74%. The company’s stock has a 5-day price change of -5.17% and 4.19% over the past three months. WDR shares are trading -12.32% year to date (YTD), with the 12-month market performance down to -16.66% lower. It has a 12-month low price of $9.87 and touched a high of $18.33 over the same period. Currently, 1.69 million shares have been traded, compared to an average intraday trading volume of 1.09 million shares. The stock is trading above its simple moving averages at the SMA20, SMA50, and SMA200, as the current price level is off by -4.15%, -0.95%, and -2.10% respectively.

    Institutional ownership of Waddell & Reed Financial Inc. (NYSE: WDR) 67.68M shares outstanding. Mutual fund holders own 41.86%, while other institutional holders and individual stakeholders account for 70.43% and 11.53% respectively.

    It has a market capitalization of $983.98M and a beta (3y monthly) value of 1.47. The stock’s trailing 12-month PE ratio is 10.01, while the earnings-per-share (ttm) stands at $1.46. Price movements for the stock have been influenced by the stock’s volatility, which stands at 4.32% over the week and 3.83% over the month.

    Analysts forecast that Waddell & Reed Financial Inc. (WDR) will achieve an EPS of $0.32 for the current quarter, $0.38 for the next quarter and $1.18 for 2021. The lowest estimate earnings-per-share for the quarter is $0.27 while analysts give the company a high EPS estimate of $0.38. Comparatively, EPS for the current quarter was $0.45 a year ago. Earnings per share for the fiscal year are expected to decrease by -28.80%, and -11.39% over the next financial year.

    If you are looking to buy this stock, then you may note that the average analyst recommendation by 8 brokerage firm advisors rate Waddell & Reed Financial Inc. (WDR) as a “Hold” at a consensus score of 3.90. Specifically, 0 Wall Street analysts polled rate the stock as a buy, while 2 of the 8 advise that investors “hold,” and 4 rated it as a “Sell.”

    Looking at the support for the WDR, a number of firms have released research notes about the stock. Evercore ISI stated their Underperform rating for the stock in a research note on October 22, 2019, with the firm’s price target at. BofA/Merrill coverage for the Waddell & Reed Financial Inc. (WDR) stock in a research note released on September 13, 2019 offered a Underperform rating with a price target of. BofA/Merrill was of a view on April 12, 2019 that the stock is Neutral, while Citigroup gave the stock Sell rating on January 14, 2019, issuing a price target of. Evercore ISI on their part issued In-line rating on April 30, 2018.


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