(July 27 – 17:35) – Merill Lynch Canada is out with a positive report in the wake of earnings news at Investors Group Inc.
Merrill says Investors “continues to post consistent earnings growth above 20% while moving its dividend higher, a key positive in our opinion”. It attributes the falloff in insurance and mortgages to higher interest rates. Mutual fund net sales remain disappointing though too, Merrill says.
It notes that Investors’ sales rep count is down by 113. “Management has indicated that recruiting efforts have been refocused to attract higher-calibre people. We suggest that the fundamentals of the company speak to this taking place, but mutual fund net sales are indicating contrary.”
Nevertheless, Merrill maintains its opinion and $27 price target.
-IE Staff