Schroders (LON:SDR) Trading 28.8% Higher – Should You Buy?

Schroders plc (LON:SDR)’s share price rose 28.8% during trading on Thursday . The company traded as high as GBX 599.50 and last traded at GBX 588.66. Approximately 240,171,875 shares changed hands during mid-day trading, an increase of 744% from the average daily volume of 28,451,422 shares. The stock had previously closed at GBX 457.

Key Schroders News

Here are the key news stories impacting Schroders this week:

• Positive Sentiment: Reported sale to Nuveen — media outlets are reporting that Schroders agreed a roughly $13.5bn transaction and that the Schroder family is selling its stake, a development investors view as a transformational deal that could unlock value and command a takeover premium. Read More.
• Positive Sentiment: Insider buying — two insiders (Meagen Burnett and Richard Oldfield) made small purchases around GBX 467 recently; while modest in size, insider buys are being read as a signal of confidence amid the takeover/strategic news. Read More.
• Positive Sentiment: Analyst support remains — several brokers (JPMorgan, RBC, UBS) have overweight/buy stances or raised targets in recent months, giving the name ongoing buy-side coverage that can amplify positive newsflow. Read More.
• Neutral Sentiment: Q4 results released — Schroders reported GBX 36.60 EPS for the quarter, with a net margin of 12.8% and ROE of 8.65%. Results are available in the company release; investors are parsing whether the earnings trajectory supports any deal valuation assumptions. Read More.
• Neutral Sentiment: Broader market coverage and focus — Schroders was highlighted in market live/overseas stock roundups (WSJ, Investors Chronicle), increasing visibility and likely contributing to the very large intraday volume and volatility. Read More.
• Negative Sentiment: Some analyst targets still below current levels — a subset of firms have trimmed or kept conservative targets (Citigroup trimmed its target previously), so parts of the Street remain cautious; consensus price targets are mixed and could limit upside if the deal terms disappoint. Read More.

Analyst Upgrades and Downgrades

SDR has been the topic of a number of recent research reports. Jefferies Financial Group restated a “hold” rating and issued a GBX 420 price target on shares of Schroders in a research report on Friday, January 9th. Royal Bank Of Canada raised their target price on shares of Schroders from GBX 435 to GBX 440 and gave the stock a “buy” rating in a report on Thursday, October 30th. UBS Group restated a “buy” rating and issued a GBX 455 target price on shares of Schroders in a research note on Friday, October 17th. JPMorgan Chase & Co. reaffirmed an “overweight” rating on shares of Schroders in a report on Friday, January 9th. Finally, Citigroup reduced their price objective on Schroders from GBX 435 to GBX 430 and set a “buy” rating for the company in a research report on Friday, October 24th. Four analysts have rated the stock with a Buy rating and three have issued a Hold rating to the stock. Based on data from MarketBeat.com, Schroders has an average rating of “Moderate Buy” and a consensus price target of GBX 413.86.

Schroders Trading Up 28.6%

The firm has a 50-day moving average of GBX 424.25 and a 200 day moving average of GBX 398.47. The company has a current ratio of 4.90, a quick ratio of 4.32 and a debt-to-equity ratio of 12.95. The stock has a market capitalization of £9.11 billion, a price-to-earnings ratio of 26.35, a PEG ratio of 1.28 and a beta of 1.17.

Schroders (LON:SDR) last released its quarterly earnings results on Thursday, February 12th. The company reported GBX 36.60 earnings per share (EPS) for the quarter. Schroders had a return on equity of 8.65% and a net margin of 12.81%. As a group, equities analysts predict that Schroders plc will post 33.7347131 EPS for the current fiscal year.

Schroders Company Profile

Schroders plc is a publicly owned investment manager. The firm also provides advisory and consultancy services. It provides its services to financial institutions, high net worth clients, large corporate, local authority, charitable entities, individuals, pension plans, government funds, insurance companies, and endowments. The firm launches and manages equity mutual funds and manages fixed income mutual funds for its clients. It also manages hedge for its clients. The firm invests in the public equity, fixed income, and alternative investment markets across the globe.