UPDATE 1-Analysts raise T. Rowe earnings outlook, price target

lunes 27 de julio de 2009 16:26 CEST

 July 27 (Reuters) - Several analysts on Monday boosted
their earnings outlook and share-price target for T. Rowe Price
Group Inc (TROW.O: Cotización) to reflect the higher-than-expected
quarterly profit the company posted.
 "In recent months, T. Rowe's fund performance has staged a
significant turnaround which, coupled with better than expected
cost controls, should support better earnings growth than the
peer group," FBR Capital Markets analysts said.
 FBR analysts raised their rating on the stock to "market
perform" from "underperform," and price target to $42 from $33.
During the second quarter, the Baltimore-based company, one of
the 10 largest publicly traded U.S. fund managers, took in $3.5
billion of new money, including $4.1 billion that investors
added to its mutual funds.
 According to an analyst at Barclays, T. Rowe continues to
attract steady inflows, which come in at a faster pace when
compared to the industry, owing to its focus on the retirement
 The company's target-date-retirement funds, which make up
roughly 10 percent of the company's assets, pulled in $1.8
billion during the second quarter.
 Going forward, the company is well positioned to achieve
positive operating leverage as it targets $17 million in
annualized net savings from its workforce reduction in the
first half of 2009, Barclays' Roger Freeman added.
 Analysts at FBR, Barclays, Jefferies & Co, Keefe Bruyette
and Woods, and Citigroup expect T. Rowe to post 2009 earnings
of $1.43 a share to $1.53. They previously expected the company
to earn between $1.29 a share and $1.40.
 The combination of T. Rowe's above average equity base and
recent cost cutting efforts have enhanced its earnings'
outlook, Jefferies analysts said.
 Shares of the company rose about 1 percent to $45.75 in
Monday morning trading on Nasdaq.
 The table below lists the price target changes on the stock:
                    New     Old
 Barclays              $47     $44             Equal-weight
 Citigroup             $52     $48             Buy
 FBR                   $42     $33             Market perform
 Jefferies             $44     $36             Hold
 KBW                   $46     $43             Market Perform
  (Reporting by Tenzin Pema in Bangalore; Editing by Maju