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On Thursday, Abrdn Plc (ABDN:LN) (OTC: SLFPY) received an upgraded stock rating from Jefferies, moving from Hold to Buy. The financial research firm also increased its price target for Abrdn’s shares to GBP2.15, up from the previous GBP1.40. This adjustment reflects a more optimistic outlook for the investment company’s growth prospects. The market has already responded positively, with InvestingPro data showing a remarkable 16.7% return over the past week and the stock reaching its 52-week high of $9.19.
The upgrade by Jefferies was influenced by Abrdn’s strong full-year 2024 results, which were well-received by the market. The firm’s realistic targets for 2026 and strategic use of defined benefit (DB) surplus to support defined contribution (DC) obligations contributed to the positive view. Analysts believe that these factors, along with a short-covering effect, have created a favorable investment scenario for Abrdn. InvestingPro analysis reveals the company maintains a strong financial position with a "GREAT" overall health score and an impressive dividend yield of 7.23%, having maintained dividend payments for 19 consecutive years.
Jefferies’ new price target is based on updated forecasts and higher multiples applied to Abrdn’s operating segments. The analysts at Jefferies see potential for Abrdn to return to growth, particularly through the contributions of Interactive Investor (ii), which is expected to drive performance in the near term. The company currently trades at a P/E ratio of 13.4x and a price-to-book ratio of 0.61, though InvestingPro analysis suggests the stock may be in overbought territory. Subscribers can access 6 additional ProTips and comprehensive valuation metrics to make more informed investment decisions.
In addition to the financial updates, Jefferies also mentioned Abrdn’s recent rebranding, referring to the name change as a cosmetic improvement. The firm’s update to its corporate identity aligns with its strategic developments and refreshed market approach.
The upgrade from Jefferies signals confidence in Abrdn’s ability to achieve its stated goals and improve its market position. With the revised price target and rating, investors may take a closer look at Abrdn’s stock as it aims to navigate the path to growth and shareholder value enhancement.
In other recent news, Abrdn Plc has seen updates from major financial institutions regarding its stock valuation and financial forecasts. Deutsche Bank (ETR:DBKGn) has increased its price target for Abrdn to GBP2.00, maintaining a Buy rating following the company’s financial year 2024 results. Analysts have aligned their forecasts with Abrdn’s goal of generating approximately £300 million in net capital by 2026, though they estimate earnings before interest and taxes (EBIT) at £259 million due to challenges in the asset management sector. Meanwhile, Morgan Stanley (NYSE:MS) has adjusted its price target slightly upward to GBP1.49, keeping an Underweight stock rating. The adjustment follows Abrdn’s fourth-quarter trading update, with assets under management slightly exceeding expectations at £511 billion. Morgan Stanley’s forecast for earnings per share remains unchanged for 2024 but sees a slight increase for 2025 and 2026, driven by stronger customer growth in Abrdn’s Personal segment. The company added 32,000 net new clients in 2024, surpassing previous estimates. Both Deutsche Bank and Morgan Stanley’s analyses reflect the impact of Abrdn’s strategic plans and market positioning on their financial projections.
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