DST Systems (DST) Downgraded by Zacks Investment Research

Zacks Investment Research downgraded shares of DST Systems (NYSE:DST) from a hold rating to a sell rating in a report published on Tuesday.

According to Zacks, “DST Systems is a worldwide provider of information processing software and systems. We believe that DST Systems’ business volume and massive scale of operation in Financial Services will attract new customers. Moreover, we expect steady contributions from acquisitions (BFDS and IFDS) to support revenue growth. Continued share buybacks and dividend payments are the other encouraging factors. The company also has a strong business model. It generates recurring revenues and a good percentage of its business comes from long-term contracts with its customers. The model ensures a minimum revenue level even when there are limited transactions. However, persistent decline in registered accounts, a high debt burden, ongoing consolidation in the U.S. financial services market and stiff competition from peers might put its fundamentals under pressure. Notably, shares of the company has underpreformed the industry over the past one year.”

DST has been the topic of several other reports. Morgan Stanley lifted their price target on DST Systems from $57.00 to $61.00 and gave the company an equal weight rating in a research report on Monday, October 23rd. Robert W. Baird restated a buy rating and set a $68.00 price target on shares of DST Systems in a research report on Thursday, October 12th. Two equities research analysts have rated the stock with a sell rating, one has given a hold rating and three have issued a buy rating to the company. DST Systems has a consensus rating of Hold and an average target price of $68.50.

DST Systems (NYSE:DST) traded up $1.41 during midday trading on Tuesday, hitting $63.78. The company had a trading volume of 393,900 shares, compared to its average volume of 296,167. The company has a quick ratio of 1.09, a current ratio of 1.09 and a debt-to-equity ratio of 0.42. DST Systems has a one year low of $50.22 and a one year high of $63.87. The company has a market capitalization of $3,755.93, a price-to-earnings ratio of 9.41, a PEG ratio of 1.73 and a beta of 1.36.

DST Systems (NYSE:DST) last released its quarterly earnings results on Friday, October 20th. The technology company reported $0.76 earnings per share for the quarter, beating the Thomson Reuters’ consensus estimate of $0.73 by $0.03. DST Systems had a return on equity of 16.20% and a net margin of 21.26%. The company had revenue of $562.60 million for the quarter, compared to analyst estimates of $523.57 million. During the same period in the previous year, the company posted $0.77 earnings per share. The firm’s revenue was up 45.5% on a year-over-year basis. research analysts predict that DST Systems will post 3.08 EPS for the current year.

The business also recently disclosed a quarterly dividend, which was paid on Friday, December 8th. Shareholders of record on Wednesday, November 22nd were paid a dividend of $0.18 per share. This represents a $0.72 dividend on an annualized basis and a yield of 1.13%. The ex-dividend date was Tuesday, November 21st. DST Systems’s payout ratio is 10.63%.

A number of large investors have recently made changes to their positions in the business. Prudential Financial Inc. raised its stake in DST Systems by 8.9% during the third quarter. Prudential Financial Inc. now owns 1,037,864 shares of the technology company’s stock valued at $56,958,000 after buying an additional 84,398 shares during the last quarter. AXA raised its stake in DST Systems by 9.5% during the third quarter. AXA now owns 228,700 shares of the technology company’s stock valued at $12,551,000 after buying an additional 19,900 shares during the last quarter. Public Employees Retirement System of Ohio raised its stake in DST Systems by 105.7% during the third quarter. Public Employees Retirement System of Ohio now owns 63,484 shares of the technology company’s stock valued at $3,484,000 after buying an additional 32,617 shares during the last quarter. GSA Capital Partners LLP raised its stake in DST Systems by 15.5% during the third quarter. GSA Capital Partners LLP now owns 78,571 shares of the technology company’s stock valued at $4,312,000 after buying an additional 10,524 shares during the last quarter. Finally, Algert Global LLC purchased a new position in DST Systems during the third quarter valued at $422,000. Institutional investors and hedge funds own 85.71% of the company’s stock.

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About DST Systems

DST Systems, Inc (DST) is a provider of technology-based information processing and servicing solutions. The Company offers its solutions through data management, business processing and customer communications solutions to clients within the asset management, brokerage, retirement and healthcare markets.

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