FII  Federated Investors Inc.

Exchange

NYSE

Sector

Finance

Industry

Investment Managers

Market Cap.

2.64B

Vuru Grade

60.61/100

Current Price

$26.89
+0.02 (+0.07%)

Growth Price

$21.35
Overvalued by 20.62%

Stability Price

$38.17
Undervalued by 41.95%

Company Metrics

  • P/E 13.25
  • P/S 2.31
  • P/B 4.43
  • EPS 2.03
  • Cash ROIC 5.80%
  • Cash Ratio -
  • Dividend 1.00 / 3.72 %
  • Avg. Vol. 925,002.00
  • Shares 98.18M
  • Market Cap. 2.64B

Company Description

Federated Investors, Inc. is a publicly owned investment manager. The firm provides its services to individuals, including high net worth individuals, banking or thrift institutions, investment companies, pension and profit sharing plans, pooled investment vehicles, charitable organizations, state or municipal government entities, and registered investment advisors. Through its subsidiaries, it ma... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

Federated Investors More Upside Than Peers
Seeking Alpha - Feb 1, 2017
One of my stock screeners unearthed Federated Investors (NYSE:FII) today which definitely on the surface looks that it has upside.
The Federated Investors, Inc. (FII) Shares Bought by Pacer Advisors Inc. - DailyQuint
Federated Investors, Inc. (FII) To Go Ex-Dividend on February 6th - Community Financial News
Federated Investors Inc. (FII) Moves Higher on Volume Spike for February 15
Equities.com - Feb 15, 2017
Federated Investors Inc. (FII) traded on unusually high volume on Feb. 15, as the stock gained 1.81% to close at $27.00. On the day, Federated Investors Inc. saw 1.23 million shares trade hands on 8,540 trades. Considering that the stock averages only ...
Successful Earnings Option Trading: Federated Investors Inc (NYSE:FII) - CML News
The Federated Investors, Inc. (FII) Shares Sold by the Wharton Business Group LLC - DailyQuint
Federated Investors, Inc. Completes Transition of Assets from Horizon Advisers
Yahoo Finance - Jan 30, 2017
30, 2017 /PRNewswire/ -- Federated Investors, Inc. (FII), one of the nation's largest investment managers, completed the acquisition of certain investment management related assets of Horizon Advisers, an unincorporated division of Whitney Bank ...
The Federated Investors, Inc. (FII) PT Set at the $28.00 by the Jefferies Group
DailyQuint - 7 hours ago
Federated Investors, Inc. (NYSE:FII) has been assigned a $28.00 price target by equities researchers at Jefferies Group in a research note issued to investors on Tuesday.
Federated Investors, Inc. (FII) Shares Sold by Cipher Capital LP - Sports Perspectives
What are Research Firms Saying About Federated Investors, Inc. (NYSE:FII)? - Aiken Advocate
Federated Investors Is Riding the Wave of Higher Rates
Motley Fool - Jan 27, 2017
Federated Investors (NYSE:FII) released 2016 4Q earnings after market close on January 26, 2016. The company reported that net income grew 17% year over year to $55.8 million in the fourth quarter.
Federated Investors, Inc. Reports Fourth Quarter and Full-Year 2016 Earnings - PR Newswire (press release)
Federated Investors, Inc Reveals 17% Gain In Q4 Profit - Nasdaq
Federated Investors Inc. PA Has $16144000 Stake in United Continental Holdings ...
BNB Daily (blog) - 5 hours ago
United Continental Holdings logo Federated Investors Inc. PA boosted its stake in United Continental Holdings, Inc. (NYSE:UAL) by 21.3% during the fourth quarter, Holdings Channel reports.
ENI SpA (E) Position Reduced by Federated Investors Inc. PA
BNB Daily (blog) - Feb 18, 2017
ENI S.p.A. logo Federated Investors Inc. PA cut its stake in shares of ENI S.p.A. (NYSE:E) by 48.2% during the fourth quarter, Holdings Channel reports.
Federated Investors Inc. PA Has $18533000 Stake in CNO Financial Group, Inc. (CNO)
BNB Daily (blog) - Feb 18, 2017
CNO Financial Group logo Federated Investors Inc. PA lowered its stake in CNO Financial Group, Inc. (NYSE:CNO) by 15.3% during the fourth quarter, according to its most recent disclosure with the SEC.
Option Market: Federated Investors Inc Risk Hits A Depressed Level
CML News - Feb 17, 2017
We're going to look at a proprietary risk rating for the next 30-days built by Capital Market Laboratories (CMLviz) based on a large number of interactions of data points, many of which come directly from the option market for Federated Investors Inc ...
Federated Investors Inc. PA Decreases Position in Webster Financial ...
BNB Daily (blog) - 5 hours ago
Webster Financial Corporation logo Federated Investors Inc. PA reduced its stake in shares of Webster Financial Corporation (NYSE:WBS) by 33.2% during the fourth quarter, Holdings Channel reports.
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for FII to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate FII's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

$26.89 Current Price

$21.35 Growth Price (DCF)

Overvalued by 20.62%


Growth Rate Assumed by Market: 8.03%


Future Free Cash Flow Growth Rate: 0.0%


Discount Rate: 15.0%


Show Free Cash Flow numbers

$38.17 Stability Price (EPV)

Undervalued by 41.95%


Discount Rate: 15.0%

$31.15 Book Price

Undervalued by 15.85%


Poor Cash Return on Invested Capital over the past 5 years

FII has been unable to consistently generate sufficient returns from its investments in buildings, projects and equipment. This could be due to poor management, lack of an economic moat or the capital intensive nature of the business.

FII has only created $5.80 of cash for every $100 invested.
Figures in USD. Fiscal year ends in December
20112012201320142015
Free Cash Flow 113.49M - - - 227.16M
divided by
Invested Capital 1.15B 1.09B 1.14B 1.14B 1.19B
Cash ROIC 9.86% - - - 19.13%

Excellent Return on Equity over the past 5 years

Over the past 5 years, FII has generated strong profits with money shareholders have invested. This is considered one of the best indicators of quality management. Beware of extremely high Return on Equity (> 50%) as this is often unsustainable.

FII has generated $29.03 of Earnings for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in December
20112012201320142015
Net Income 150.91M 188.09M 162.18M 149.24M 169.81M
divided by
Stockholders' Equity 541.96M 495.43M 566.12M 609.49M 647.82M
Return on Equity 27.84% 37.96% 28.65% 24.49% 26.21%

Good Business Performance over the past 10 years

It's likely FII has been unable to maintain profitability in tough economic times, making it a somewhat cyclical business. The other possibility is FII has expended significant capital on items such as property, plant and equipment in specific years. Look for correlations.

FII has created positive free cash flow for 7 or 8 of the past 10 years.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Free Cash Flow 288.98M 319.31M 300.65M 248.38M 208.08M 113.49M - - - 227.16M

Good Balance Sheet

FII's Total Assets double Total Liabilities. Its financial position is adequate. Remember to check Shareholders' Equity to see if it's stable or growing. It's one of the best measures of whether a company is creating value for shareholders.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Cash - - - - - - - - - -
Current Assets - - - - - - - - - -
Total Assets 810.29M 840.97M 846.61M 912.43M 1.15B 1.15B 1.09B 1.14B 1.14B 1.19B
Current Liabilities - - - - - - - - - -
Total Liabilities 280.92M 266.96M 423.24M 384.23M 661.71M 608.90M 594.63M 569.68M 531.03M 539.39M
Stockholder' Equity 529.38M 574.02M 423.37M 528.21M 491.80M 541.96M 495.43M 566.12M 609.49M 647.82M
Current Ratio - - - - - - - - - -
TL-to-TA 0.35 0.32 0.50 0.42 0.57 0.53 0.55 0.50 0.47 0.45

Low or No Reinvestment of Profits over the past 10 years

FII has either been retaining a small amount of their earnings or has done so inconsistently. A lack of consistency could be due to FII operating at a loss or them having such a strong economic moat they feel comfortable spending profits on growth. Be wary of future prospects and if applicable, inspect the moat's sustainability.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Retained Earnings 1.07B 1.19B 1.03B 1.11B 1.04B 1.07B 984.51M 1.02B 505.39M 545.79M
Retained Earnings Growth - 11.64% -13.50% 7.40% -6.20% 3.22% -7.98% 3.87% -50.58% 7.99%

Potential Competitive Advantage over the past 10 years

FII potentially has a competitive advantage. This could be strong branding, the ability to keep costs low, or some other characteristic that is hard to replicate. Look at its future prospects to determine sustainability and whether the economic moat will strengthen.

$18.40 of every $100 of Revenue have been pure profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Net Income 197.73M 217.47M 224.32M 197.29M 179.11M 150.91M 188.09M 162.18M 149.24M 169.81M
divided by
Revenue 978.86M 1.13B 1.22B 1.18B 958.82M 901.37M 945.71M 878.37M 859.25M 926.61M
Net Profit Margin 20.20% 19.29% 18.31% 16.76% 18.68% 16.74% 19.89% 18.46% 17.37% 18.33%

Weak Pricing Power over the past 10 years

FII is likely in a highly competitive industry, due to low barriers to entry. It's because of this, that FII has been unable to raise prices and increase their profitability. This puts them in a poor position if inflation becomes an issue, as they would struggle to pass higher costs onto consumers.

Only $- of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Gross Profit - - - - - - - - - -
divided by
Revenue 978.86M 1.13B 1.22B 1.18B 958.82M 901.37M 945.71M 878.37M 859.25M 926.61M
Gross Margin - - - - - - - - - -

Low Capital Intensity over the past 10 years

FII has consistently used a small portion of their Net Income buying new equipment or investing in new facilities. This indicates that FII may require minimal investment to stay competitive. This leaves them with extra money to spend on growing their business and potentially buying back stock.

5.30% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Capital Expenditure 4.74M 7.69M 8.13M 26.21M 7.87M - 8.68M 10.32M 8.85M 6.03M
divided by
Net Income 197.73M 217.47M 224.32M 197.29M 179.11M 150.91M 188.09M 162.18M 149.24M 169.81M
Capital Expenditure Ratio 2.40% 3.54% 3.62% 13.28% 4.39% - 4.61% 6.36% 5.93% 3.55%

Very Strong Dividend History over the past 10 years

FII has consistently distributed a dividend for at least the past 10 years. Such a long dividend history suggests FII is very established in its market and that its dividend distribution is likely to continue for a significant period of time.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Dividend Paid 78.84M 88.76M 375.65M 98.50M 228.65M 99.96M 256.75M 191.20M 117.24M 110.31M
divided by
Shares Outstanding 106.31M 102.58M 100.86M 100.06M 99.99M 100.63M 100.31M 100.67M 100.72M 100.48M
Dividend Paid Per Share 0.74 0.87 3.72 0.98 2.29 0.99 2.56 1.90 1.16 1.10
Price at Year End 26.69 33.22 13.98 24.13 24.76 14.96 19.84 28.47 33.19 28.80
Dividend Yield 2.78% 2.60% 26.64% 4.08% 9.24% 6.64% 12.90% 6.67% 3.51% 3.81%

Strong History of Stock Buybacks over the past 10 years

FII has a strong history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Shares Outstanding 106.31M 102.58M 100.86M 100.06M 99.99M 100.63M 100.31M 100.67M 100.72M 100.48M
Stock Bought Back - 3.63% 1.71% 0.80% 0.06% -0.63% 0.32% -0.35% -0.05% 0.24%
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