I am investing with personal money and am thinking about investing in Evercore. They appear to be undervalued with high growth expectations, and a stable business. Can anybody give some insight on their expectations for EVR?
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Curious to hear how you valued EVR (on a high-level)
It's a fin serv company. This is for stable and very low risk / low return invetsments. Better spending time on high flying growth stocks.
what is your thesis? I have been looking at HLI and bought when it dipped last week, seems to be killing it in RX (in Europe too) and by far the most anti cyclical boutique. It is trading at 16x NOPAT / 12x EBITDA
I honestly don't have a finalized thesis yet, I was just made aware of the idea by a friend and was able to see multiple dividend discount models and that said that Evercore should trading closer to $75 (it was at $90 pre covid). I havn't had the time to do to much research yet, and have primarily invested in tech and enegery before this, so I am new to investing in financials. However, it appears that the financials industry as a whole is undervalued. Again, I have not done any high level modeling or due dilligence yet, but will hopefully have the time to start this weekend
Would be curious to know your findings, PM me if you find anything interesting and would like to discuss. Believe the big discount in all these banks is due to impact on M&A fees - if you look at the last crisis, M&A fell by 40-60% depending on source (especially in terms of value, since large cap M&A seems to be more volatile than midmarket). This time it may be even worse given the unprecedented nature of things and thus more uncertainty for buyers. So a large cap M&A-focused shop like Evercore should be bracing for a strong hit; whether it warrants the price or not would have to look further.
Full disclosure, I am long EVR. If you look at prior cycles, M&A bounced back within 12 month of a recession. Given the financial system is intact, M&A is expected to bounce back in 2021 as travel/DD resumes. Rx will take time for the fees to come in (6 to 18 month) so 2020 will be ugly with a sharp drop in M&A and no meaningful Rx fees to balance it out. For 2021, it likely for a synchronous growth with harvesting of Rx success fees and rebound of M&A. This dynamic applies to all the shops. I think the market is giving way to much credit for the likes of PJT. Their RX is good but not 2x the quality nor the capacity of EVR. In 2019, about 30% of PJT rev was rx vs about 20% for EVR. Moreover, the ECM, asset management and research side of EVR should also provide more cashflow stabilities vs the others. Lastly, the EBs are not balance sheet banks. With a 90% variable cost structure and net cash position, EVR is virtually indestructible and should benefit from this crisis. Literally every CEO is calling up their bankers these days to discuss liability management. I believe all the EBs will do well once Corp/PEs start deploying their dry powder over the next 12 month and rx fees start coming in. However, the valuation disconnect between EVR and the rest of the group doesn't make much fundamental sense. So I am buying it on the dip and getting the 4% yield in the meantime to see if my thesis is correct.
This is exactly along the lines of what I am thinking. I think I am going to enter a long position on Monday.
LOL what is EVERCORE now the next hot tech company like AMazon?
Also, my wifi connection to this website sucks. MIght accelerate my leaving this website for good.![]()
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What are your thoughts on HLI? Middle market exposure should soften the M&A blow (more resilient than large cap) and obviously they have more exposure than others to RX. At the recent dip price of 53 it was trading at about 12x 19 EBITDA, think there could be upside from there. Not sure how much cheaper is EVR?
I don't know much about them, but just based off a quick/rough dividend model (I have not done ANY high level modeling), they actually appear to be overvalued. Full disclaimer though, I don't know much about HLI as a company compared to other banks and the modeling I did was very quick and rough.
Anyone from Evercore have any inside info? Asking for a friend.
Please don't joke around about this stuff. This is really seroius and as a prospect, don't do things like this. What if someone knows you are ad tells EVERCORE?
Also, my wifi connection to this website sucks. MIght accelerate my leaving this website for good.
What exactly is wrong with asking somebody about how they think their company is doing? Especially under an anonymous user name?
What are peoples' thoughts on Moelis or PJT stock? More exposed to RX but also more expensive
Also curious about these two
Or Lazard stock. Even cheaper right now with RX exposure
They all look good, but it appears that Evercore is cheapest. Also, it seems like there is a general consensus that Evercore is a leader among elite boutiques
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