The Brexit pain for Invesco
] is real, but it's not as bad as it looks. So argues Wells Fargo
analyst Christopher Harris
Harris' take on the publicly-traded mutual fund shop. Invesco's shares took a whopping 19.5-percent hit
in the first few days after the Brexit vote, though they have since partially rebounded (as of market close on June 29) to $24.85 each, 10.39 percent below their pre-Brexit level.
"One could make the argument that the move in IVZ's stock has wiped out the value of well over half of the entire UK operation," Harris writes. "We calculate the to-date impact of Brexit being roughly $0.20 dilutive to EPS. This implies 7% EPS dilution, which is nowhere near as bad as what is implied by the initial market reaction."
Harris has cut his price target for Invesco to $29 to $33 (down from $36 to $40), though that's still 16.7 to 32.8 percent above where it is now.
Meanwhile, Citigroup analyst Bill Katz just downgraded
Invesco to "neutral" after the Brexit vote. And a few days before the Brexit vote, Jefferies analyst Dan Fannon argued
that Invesco "checks the box with all of these buzz words in terms of its product capabilities" before reaffirming at $35 price target.
Neil Anderson, Managing Editor
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