What Happened?
Shares of asset management firm Invesco (NYSE: IVZ) jumped 3.5% in the afternoon session after Barclays raised its price target on the stock and the company announced a major transaction for its Canadian fund business.
The investment bank adjusted its price target on Invesco to $30 from $28, while it maintained an Equalweight rating on the shares. Separately, the Atlanta-based asset manager reached an agreement to reshape its Canadian operations. Invesco arranged for CI Global Asset Management to take over management of its Canadian fund business, which had approximately C$26 billion in assets. The transaction allowed Invesco to step back from directly running its funds in Canada, changing its footprint in the country while its investment teams remained involved through a partnership.
After the initial pop the shares cooled down to $29.37, up 4% from previous close.
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What Is The Market Telling Us
Invesco’s shares are somewhat volatile and have had 11 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 5 months ago when the stock gained 4.5% on the news that the major indices rebounded, as Fed Chair Jerome Powell delivered dovish remarks at the much-awaited Jackson Hole symposium.
Powell suggested that with inflation risks moderating and unemployment remaining low, the Federal Reserve might consider a shift in its monetary policy stance, including potential interest rate cuts. This outlook eased market concerns about prolonged high interest rates and their impact on economic growth. The prospect of lower borrowing costs bolstered investor confidence, particularly in sectors that have lagged, leading to a broad rally across the market.
Invesco is up 9% since the beginning of the year, and at $29.37 per share, has set a new 52-week high. Investors who bought $1,000 worth of Invesco’s shares 5 years ago would now be looking at an investment worth $1,468.
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