Compass Point Cuts Price Target on Och-Ziff Capital Management (OZM) Following Weak December

Compass Point maintained a Buy rating on Och-Ziff Capital Management Group (NYSE: OZM), and cut the price target to $7.50 (from $8.50), reflecting weaker than expected multi-strategy fund performance in December, and lower multi-strategy fund market appreciation in the first half of 2016.

Analyst Amy DeBone commented, "We decrease our price target to $7.50 from $8.50, decrease our 4Q15 estimate to $0.04 from $0.13, and decrease our 2016 EPS estimate to $1.02 from $1.22. Our revised estimates reflect weaker than expected multi-strategy fund performance in December, and lower multi-strategy fund market appreciation in the first half of 2016. We reiterate our Buy rating, as current valuation is based on short-term earnings prospects, and overly discounts the upside potential across cycles. OZM's has a proven track record of strong recoveries following weak markets. The most volatile performance timeframe for OZM was during years 2008-2009, where AUM declined from $33B to $22B. Despite having a much lower AUM base during that time than it has today, OZM maintained an average annual dividend of $0.50 and doubled the dividend in 2010. Additionally, during the 2-year period following 2011, which was most recent loss year for the OZ Master Fund prior to 2015, EPS increased over 100%, on average."

For an analyst ratings summary and ratings history on Och-Ziff Capital Management Group click here. For more ratings news on Och-Ziff Capital Management Group click here.

Shares of Och-Ziff Capital Management Group closed at $5.21 yesterday.

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