The U.S. economy is in somewhat of a rut right now. Inflation, stagflation, fears of a recession, geo-political issues, and volatility across all types of markets including stocks, commodities, and bonds, are creating the perfect recipe for disaster. Investor sentiments are constantly swinging back and forth, reflecting their dilemma as to whether or not to stay invested in the stock market.
Nonetheless, going by history, the stock market has always managed to bounce back from dire straits, giving tremendous returns for investors who made informed equity investment decisions. In this regard, following the thoughts and outlook of market experts who are at the top of their game, makes sense while making equity investment choices.
One such expert cohort consists of Wall Street’s analysts, whose opinions have the power to influence share prices. Their expertise in predicting a sector or stock’s performance by diving deep into the fundamentals and interpreting the developments, makes it wise to follow them.
The Standing of Our Expert in the Field of Investment Research
Today, in our Expert Spotlight piece, we will highlight the contribution of five-star analyst Glenn Greene to the field of equity research. Make sure to stay with us till the end to learn about his favorite stock pick and why he recommends it in uncertain times like these.
Greene is the Managing Director at reputed investment management firm, Oppenheimer. Equipped with an MBA in Finance from the NYU Stern School of Business, Greene has been tracking the business and IT services sector at Oppenheimer for more than 13 years.
Notably, he was among the few analysts who had generated maximum returns on his stock picks in the 2010’s, giving us all the more reason to take a cue from his opinions.
The TipRanks Star Ranking, which takes into account an expert’s success rate, the average returns generated, and statistical significance that improves with the increase in the number of transactions or recommendations made by the expert, keeps Greene at the top of the list. Impressively, Greene is ranked #1 not only among the 7,938 equity analysts tracked on TipRanks, but also among the 16,993 market experts in the TipRanks universe.
The analyst has a success rate of a whopping 85%, with an average return of 22.5% over the past year. Furthermore, in the past year, his picks generated an alpha of 9% over the S&P 500 index, and 4.1% over the technology sector performance.
Greene’s most profitable stock recommendation has been that of PayPal Holdings, Inc. (PYPL) in the year between January 20, 2017 and January 20, 2018, during which, the stock had gained 101%.
Greene’s Recent Favorite Stock Pick
Despite not being as active as before in the stock recommendation scene, his solid conviction makes it worthwhile to consider the only stock that he has recommended most recently.
On January 27, Green maintained his optimistic stance on SEI Investments (NASDAQ: SEIC) with a Buy rating set on January 27 this year. The stock has gained 18.61% in the past five years.
Greene's success rate on his recommendations on SEIC over the years has been 58%, with 18 accurate recommendations among 31 ratings on the stock.
Investors have had a love-hate relationship with the stock over the past five years, during which the financial services and investment platform provider has increased its earnings per share at a CAGR of 14%, but the share price growth has only witnessed a 3.47% CAGR.
Additionally, at 23%, the total shareholder returns of SEI Investments over the past 5 years (encompassing any dividends, unit-sale, etc.), have been more than the share price returns.
Despite this pullback in investor confidence, there are few things to look forward to. On April 20, SEI Investments announced its Q1’22 results which saw revenues increasing 28% year-over-year driven by an increase in assets under management (AUM) and various fee hikes.
Moreover, the last leg of 2021 was action-packed for the company, as it acquired 2 businesses to expand its market share, diversify its offerings, and boost its top line. Improving AUM balance is another factor that underscores the demand environment for SEI Investment’s services. Again, increasing demand for the SEI Wealth Platform from growing financial institutions is expected to keep the company’s financials healthy.
Wall Street, however, is trading cautiously on the stock’s prospects, with a Hold rating based on one Buy and three Holds. The average SEIC price target is $65.50, indicating a 15.20% upside from the price level at Friday’s market close. The upside suggests that the Street is fairly optimistic about a near-term improvement in price performance.
Parting Thoughts
The rest of the year holds the potential for even more more tumult than what is being experienced right now. However, the expertise and past record of Greene shows that his recommendation of SEIC can be taken as sound advice, if looking for equity investments for the long-term. The current price-to-earnings ratio of 13.3 makes the company reasonably valued. The low share prices (7% loss year-to-date) could represent a solid buying opportunity.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
