Analyst: Ladenburg set for growth acceleration

The firm, which owns three sizable independent broker-dealers, was given an 'outperform' rating on Wednesday

Oct 19, 2012 @ 2:28 pm

By Bruce Kelly

Ladenburg Thalmann Financial Services Inc., which owns three sizable independent broker-dealers, stands to benefit from long term trends such as the increase in the number of Baby Boomers retiring and advisers leaving large financial institutions.

That's the conclusion of Barrington Research Associates Inc. equity analyst Alexander Paris Jr., who started covering Ladenburg Thalmann on Wednesday and gave it a rating of “outperform” and a $2.25 per share stock price target.

Shares of Ladenburg Thalmann, which has bought all three of its IBDs since 2007, were trading at $1.34 on Friday afternoon.

“Given the appealing growth profile of the independent brokerage and advisory business (driven by the graying of America, the retirement of the baby boomers, and more individuals' taking control of their investment portfolios) as well as the steady migration of client assets and advisers from the large national firms (such as wirehouses, insurance and bank channels) to the independent channel, revenue growth should accelerate and become more predictable,” Mr. Paris wrote.

“It appears there is a secular shift in financial services as the industry is experiencing an increase in the number of independent financial advisers at independent broker-dealers, and financial advisers are leaving the large financial institutions,” he noted. “This favors firms like Ladenburg, which is well positioned to benefit from this trend.”

Another highlight is the fact that billionaire investor Phillip Frost owns 35% of Ladenburg Thalmann, Mr. Paris noted.

Ladenburg Thalmann spokesman Jonathan Doorley declined to comment on the Barrington report.

The company owns three broker-dealers: Securities America Inc., which it bought in 2011, Triad Advisors Inc., acquired in 2008, and Investacorp Inc., purchased in 2007. More than 2,700 financial advisers are affiliated with those three firms.

0
Comments

What do you think?

View comments

Recommended for you

Featured video

Events

What's the top issue on advisers minds?

Laura Pierson from Carson Group discusses how the old topic of 'Human Capital' is hot again because of millennials.

Latest news & opinion

New ways to pay for college

Experts respond to real-life scenarios of people struggling to afford higher education.

How technology is reshaping the advice business

Artificial intelligence, Amazon and robo-advisers are some of the topics on the minds of tech experts.

Best- and worst-performing sector funds and ETFs this year

A rising tide may lift all ships, but a bull market doesn't lift all stock sectors. Here are the best- and worst-performing sectors this year, with the top and bottom fund in each sector.

Betterment slapped with $400,000 fine from Finra

Robo-adviser cited for violating customer protection rule and not maintaining its books and records correctly.

Supreme Court ruling on SEC judges unlikely to upend advice industry

But it could give rise to new hearings for some advisers who are already in litigation with the agency such as Dawn Bennett.

X

Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print