What Happened?
Shares of investment management firm T. Rowe Price (NASDAQ: TROW) jumped 4.6% in the afternoon session after analysts raised their price targets for the company's stock. Keefe, Bruyette & Woods lifted its price target on T. Rowe Price to $115 from $112, while maintaining a "Market Perform" rating. In a similar update, Morgan Stanley also increased its price objective on the stock to $125 from a previous $116 and gave the shares a "positive" rating. These upward revisions from financial analysts indicated a more favorable view of the stock's potential value, which likely boosted investor confidence.
The shares closed the day at $105.36, up 3.9% from previous close.
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What Is The Market Telling Us
T. Rowe Price’s shares are not very volatile and have only had 4 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was about 1 month ago when the stock gained 5.6% on the news that the company announced a strategic collaboration with Goldman Sachs that includes a planned investment of up to $1 billion from the financial giant. As part of the agreement, Goldman Sachs intends to purchase T. Rowe Price's common stock through open-market transactions, aiming to acquire a stake of up to 3.5%. The partnership is designed to leverage the strengths of both firms to create a range of diversified investment solutions for retirement and wealth management clients. The collaboration will focus on developing products that combine public and private market offerings. The companies also plan to launch co-branded target-date investment strategies in mid-2026 that will incorporate private market assets.
T. Rowe Price is down 7.1% since the beginning of the year, and at $105.36 per share, it is trading 15.5% below its 52-week high of $124.69 from December 2024. Investors who bought $1,000 worth of T. Rowe Price’s shares 5 years ago would now be looking at an investment worth $730.75.
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