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On Wednesday, BMO Capital Markets adjusted its outlook on Fiera Capital Corp. (FSZ:CN) (OTC: FRRPF), reducing the price target to Cdn$9.00 from the previous Cdn$10.00. Despite this change, the firm maintained a Market Perform rating on the company’s shares.
The revision follows observations made by BMO Capital that Fiera Capital experienced slight net outflows in the public markets during the fourth quarter, which amounted to approximately Cdn$0.5 billion. This figure represents an annualized 1% of the company’s Assets Under Management (AUM). The outflows were primarily attributed to activities related to PineStone, but were somewhat mitigated by inflows into Fiera’s proprietary public market strategies.
Fiera Capital’s stock has witnessed a significant drop, plunging about 25% from its peak in November. However, the valuation is now seen as having aligned with the historical average, showcasing an 11% dividend yield, which is typical for the company over the long term.
The Market Perform rating by BMO Capital is based on the belief that the stock currently presents a balanced risk-reward scenario for investors. The firm’s stance suggests that, while there are outflows to consider, the normalized valuation and dividend yield may offer a stable investment opportunity.
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