On Tuesday, RBC Capital has increased the share price target for Victory Capital Holdings, Inc. (NASDAQ:VCTR) to $56.00, up from the previous target of $47.00. The firm has also reiterated its Outperform rating for the asset management company's stock. The adjustment follows a recent review of the company's first-quarter performance.
The analyst at RBC Capital cited the anticipated benefits of Victory Capital's potential transaction with Amundi US as a key factor for the revised price target. The definitive agreement for this deal is expected to be finalized by the end of the second quarter.
The transaction is believed to hold substantial opportunity for expense synergies and promises longer-term growth prospects through the non-US distribution of Victory Capital's products.
Additionally, the analyst highlighted the potential for a significant increase in Victory Capital's Assets Under Management (AUM) as a result of the deal. The firm's focus on both inorganic and organic growth avenues was noted as a reason for maintaining the positive outlook on the stock.
The analyst's comments underscored the potential for the Amundi US deal to enhance Victory Capital's financial profile and market position. "We are updating our estimates post 1Q.
Focus remains on potential Amundi US transaction, where there is significant expense synergy potential and longer-term upside potential from nonUS distribution of VCTR products, not to mention significant increase in VCTR's AUM," the analyst remarked.
Victory Capital's strategic moves and the anticipated transaction with Amundi US are being closely watched by investors, as the company continues to navigate the competitive asset management landscape.
The revised price target of $56 reflects RBC Capital's confidence in Victory Capital's growth trajectory and its ability to capitalize on synergies from its potential acquisition.
InvestingPro Insights
In light of RBC Capital's revised price target for Victory Capital Holdings, Inc. (NASDAQ:VCTR), the InvestingPro data aligns with the firm's optimistic stance. Victory Capital's market capitalization currently stands at a robust $3.29 billion, and the company is trading at a favorable P/E ratio of 13.32 based on the last twelve months as of Q1 2024. These figures underscore the company's solid financial standing in the competitive asset management sector.
Reinforcing RBC Capital's confidence, an InvestingPro Tip highlights that Victory Capital has raised its dividend for 5 consecutive years, indicating a commitment to shareholder returns. Furthermore, analysts remain bullish as evidenced by another InvestingPro Tip, with 6 analysts having revised their earnings upwards for the upcoming period, suggesting a positive outlook on the company's financial performance.
Investors considering Victory Capital's stock may find additional InvestingPro Tips on the company's performance and analyst predictions, with a total of 12 tips available for review. For those seeking to delve deeper into these insights, a visit to https://www.investing.com/pro/VCTR and using the coupon code PRONEWS24 can secure an additional 10% off a yearly or biyearly Pro and Pro+ subscription, enhancing their investment research with comprehensive data and expert analysis.
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