Thursday, Oppenheimer has increased its price target on shares of SEI Investments (NASDAQ:SEIC) to $85 from the previous $81, while maintaining an Outperform rating on the stock. The revision follows SEI Investments' third-quarter earnings, which surpassed both the analyst's expectations and the consensus estimates.
On the day, SEI Investments reported a third-quarter earnings per share (EPS) of $1.19, which is higher than the expected $1.06 and the consensus estimate of $1.07. The earnings included a one-time gain of $8.2 million, or $0.05 per share, from the sale of a property and a $5.3 million, or $0.03 per share, performance fee from LSV. Adjusting for these one-time benefits, the core EPS for the company was estimated at $1.11.
The earnings beat was attributed mainly to higher-than-anticipated revenue in the Private Banking & Trust (PB&T) and Investment Advisors segments. The analyst noted that the earnings call exuded strong sentiment and energy, marking one of the most robust calls they could recall. Most business segments of SEI Investments demonstrated double-digit revenue growth and margin expansion.
Moreover, revenue from the company's Federal Deposit Insurance Corporation (FDIC) cash program is projected to double quarter over quarter in the fourth quarter due to modifications that increased the cash sweep. The analyst believes that if this program is managed effectively, it could significantly contribute to SEI Investments' revenue and earnings.
In light of these developments, Oppenheimer has raised its estimates and price target for SEI Investments, reflecting confidence in the company's potential for continued financial growth.
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