On Jan 3, Zacks Investment Research upgraded GAIN Capital Holdings, Inc. (GCAP) to a Zacks Rank #1 (Strong Buy).
Why the Upgrade?
GAIN Capital has been witnessing rising earnings estimates following the announcement of strong retail metrics in the first two months of the December quarter. Shares of this trading services and solutions provider recorded a one-year return of 19.9%. Further, GAIN Capital has recorded an average positive earnings surprise of 193.93% in the last four trailing quarters.
In Dec 2014, GAIN Capital reported operating metrics for the month of Nov 2014. Retail OTC trading volume increased 30.3% year over year to $221.0 billion, following a 45.2% increase in October. Moreover, average daily retail OTC trading volume of $11.1 billion surged 36.8% year over year after the 45.2% rise in Oct 2014.
Impressive net revenue and a strong capital position drove GAIN Capital's third-quarter 2014 results reported on Nov 6. The company reported earnings per share of 36 cents, significantly beating the Zacks Consensus Estimate. Also, net income doubled more than the prior-year quarter figure aided by the 71% year over year jump in net revenue.
Analysts’ bullish stance on the stock was reflected in the estimate revisions over the past 30 days. For 2014, the Zacks Consensus Estimate advanced 3% to 69 cents per share. It moved up 2.7% to 75 cents per share for 2015.
Other Stocks to Consider
Some other stocks in the same sector worth considering include FXCM Inc. (FXCM) and JMP Group Inc. (JMP), with a Zacks Rank #1, while KCG Holdings, Inc. (KCG) carries a Zacks Rank #2 (Buy).
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