Core Viewpoint - The article discusses the current state of retail investor behavior and highlights seven undervalued retail stocks that present investment opportunities. Retail Investor Behavior - Retail investors have shifted their behavior in Q1 2026, moving from buying dips to selling during stock surges, indicating decreased activity [1] - Retail investors accounted for approximately 18% of stock trading activity, a decline from the previous quarter and one of the lowest levels since 2024 [2] - The past week marked the slowest retail buying activity in four months, with trading volumes down over 50% compared to pre-Iran war levels [2] Influence of Key Figures - Elon Musk is noted for his significant influence on retail investors, possessing the ability to generate enthusiasm among individual investors [3] Methodology for Stock Selection - The article utilized stock screeners to identify retail stocks with a forward P/E under 15, focusing on those with the highest number of hedge fund holders as of Q4 2025 [5] - Hedge fund sentiment data was sourced from Insider Monkey's database, with the strategy showing a historical outperformance of the market [6] Undervalued Retail Stocks - **Kohl's Corporation (NYSE:KSS)** is highlighted as one of the most undervalued retail stocks, with a recent price target cut from $21 to $18 by Evercore ISI, which maintains an In Line rating [7] - Evercore ISI noted improvements in Kohl's same-store sales from fiscal Q4, but anticipates challenges due to macroeconomic factors [7] - Citi also lowered its price target for Kohl's from $20 to $14, reiterating a Neutral rating, citing missed sales and gross margin estimates in fiscal Q4 [8] - Kohl's operates family-oriented department stores offering a variety of products including footwear, apparel, beauty products, and home goods [9]

Core Insights - Albert Anthony is a Croatian-American business author and analyst contributing to Seeking Alpha with over 1,000 followers [1] - He has authored a book titled "Investing in REITs: A Fundamental & Technical Analysis (2026 Edition)" available on Amazon [1] - Anthony has a background in business and information systems, having worked at Charles Schwab, a top 10 financial firm [1] - He operates his own boutique equities research firm, Albert Anthony & Company, remotely [1] - The author has participated in numerous business and innovation conferences and has hosted a program for Online Live TV Croatia [1] - He holds a B.A. in Political Science and various certifications, including Microsoft Fundamentals and Risk Management specialization from CFI [1] - Anthony is also active on YouTube, discussing REITs and sharing insights as an investor [1] Company and Industry Summary - Albert Anthony & Company is a Texas-registered business focused on equities research [1] - The firm provides general market commentary and research based on publicly available data [1] - The author does not engage with non-publicly traded companies, small cap stocks, or startup CEOs [1] - The company does not provide personalized financial advisory services or manage client funds [1]

Core Viewpoint - Investors in the Financial - Investment Bank sector may consider Evercore (EVR) and Robinhood Markets, Inc. (HOOD) as potential undervalued stocks, with a closer examination suggesting that EVR may be the superior option for value investors [1]. Group 1: Company Rankings and Earnings Outlook - Evercore currently holds a Zacks Rank of 2 (Buy), while Robinhood has a Zacks Rank of 3 (Hold) [3]. - EVR has experienced a stronger improvement in its earnings outlook compared to HOOD, which is a significant factor for value investors [3]. Group 2: Valuation Metrics - EVR has a forward P/E ratio of 14.84, significantly lower than HOOD's forward P/E of 30.73 [5]. - The PEG ratio for EVR is 0.44, indicating a more favorable valuation relative to its expected earnings growth, while HOOD's PEG ratio stands at 1.60 [5]. - EVR's P/B ratio is 4.56, compared to HOOD's P/B of 6.98, further highlighting EVR's more attractive valuation metrics [6]. Group 3: Value Grades - EVR has a Value grade of B, while HOOD has a Value grade of F, reflecting the differences in their valuation metrics and overall attractiveness to value investors [6][7]. - The stronger estimate revision activity and more appealing valuation metrics for EVR suggest it is the preferred choice for value investors at this time [7].

Core Insights - Zacks Premium offers tools for investors to enhance their stock market engagement and confidence, including daily updates, research reports, and stock screens [1] Zacks Style Scores - Zacks Style Scores are indicators that help investors select stocks likely to outperform the market in the next 30 days, rated from A to F based on value, growth, and momentum [2] - The Style Scores consist of four categories: Value Score, Growth Score, Momentum Score, and VGM Score, each focusing on different investment strategies [3][4][5][6] Value Score - The Value Score identifies attractive and discounted stocks using ratios like P/E, PEG, Price/Sales, and Price/Cash Flow [3] Growth Score - The Growth Score assesses a company's financial strength and future outlook based on projected and historical earnings, sales, and cash flow [4] Momentum Score - The Momentum Score focuses on trends in stock price and earnings outlook, utilizing factors like one-week price change and monthly earnings estimate changes [5] VGM Score - The VGM Score combines all three Style Scores, providing a comprehensive indicator for selecting stocks with strong value, growth, and momentum [6] Zacks Rank - The Zacks Rank is a proprietary model that uses earnings estimate revisions to help investors build successful portfolios, with 1 (Strong Buy) stocks yielding an average annual return of +23.93% since 1988, significantly outperforming the S&P 500 [7] - There are over 800 top-rated stocks available, making it essential to use Style Scores to narrow down choices [8] Stock to Watch: Evercore (EVR) - Evercore Inc. is a global independent investment banking advisory firm with a Zacks Rank of 2 (Buy) and a VGM Score of A, indicating strong investment potential [11] - The company has a Value Style Score of B, supported by a forward P/E ratio of 14.84, making it attractive for value investors [11] - Recent earnings estimates for fiscal 2026 have been revised higher, with the Zacks Consensus Estimate increasing by $0.47 to $18.52 per share, and an average earnings surprise of +50.9% [12]

Core Insights - OPW Retail Fueling's 71SO Segmented Overfill Prevention Valve has received CARB EVR certification, indicating it meets high safety, containment, and emission standards [1][2] - The CARB certification is recognized as a stringent regulatory benchmark for fueling equipment, ensuring that approved products meet rigorous environmental and operational standards [2] - The valve's design allows for reduced storage, shipping, installation, and testing complexities, providing logistical advantages for fuel retailers [3] Product Features - The 71SO Segmented Overfill Prevention Valve retains a two-stage positive shut-off mechanism, ensuring reliable performance for fuel retailers [6] - The valve's modular design, consisting of four interlocking segments, simplifies storage and logistics, allowing for more compact packaging and easier transport [6] - The segmented design also helps reduce freight costs by eliminating overlength fees and preventing shipping damage [6] Company Overview - OPW Retail Fueling is part of Dover Corporation, a diversified global manufacturer with annual revenue exceeding $8 billion [5] - The company specializes in fluid-handling solutions for the retail-fueling industry, focusing on safety, reliability, efficiency, and business performance [4] - OPW has manufacturing operations across North America, Europe, Latin America, and Asia Pacific, with a global sales presence [4]

Industry Overview - The Zacks Investment Bank industry is poised to benefit from clarity on trade and monetary policy, a resilient economy, and lower financing costs, which will enhance M&A and underwriting prospects [1] - The industry consists of firms providing financial products and services, including advisory transactions to corporations, governments, and financial institutions, evolving from initial public offerings (IPOs) and M&As to include securities research and investment management [3] Current Trends - The underwriting and advisory businesses are experiencing a rebound after a slump due to geopolitical tensions and macroeconomic uncertainty, with expectations of a strong investment banking recovery under a business-friendly administration [4] - The outlook for M&As and underwriting operations is positive, driven by a resilient economy and renewed corporate confidence, although ongoing geopolitical conflicts may pose challenges [5] - Trading revenues are expected to remain strong due to increased market volatility from geopolitical risks and tariff concerns, leading to heightened client activity [6] Technological Advancements - Rising investments in AI and technology are anticipated to weigh on costs in the short term but are expected to enhance long-term operating efficiency for industry players [2][7] - Companies are focusing on innovative trading platforms and proprietary software to improve operations and attract talent, which will support revenue growth despite initial technology-related expenses [7] Market Performance - The Zacks Investment Bank industry has outperformed its sector and the S&P 500 over the past year, with a collective gain of 22.8% compared to the S&P 500's 21.5% and the Zacks Finance sector's 8% [12] - The industry currently holds a Zacks Industry Rank of 29, placing it in the top 12% of over 240 Zacks industries, indicating solid near-term prospects [8][9] Valuation Metrics - The industry has a trailing 12-month price-to-tangible book ratio (P/TBV) of 2.83X, which is above the median level of 2.23X over the past five years, and is trading at a discount compared to the broader market [15] Company Highlights Morgan Stanley - Morgan Stanley, with a market cap of $245.9 billion, is focusing on diversifying its revenue streams and has seen its shares increase by 31.8% over the past year [21] - The company is expected to benefit from a favorable macroeconomic backdrop supporting its investment banking business, with rising demand for advisory and underwriting services [20] Interactive Brokers - Interactive Brokers, with a market cap of $112.3 billion, has a strong technological edge and has seen its shares soar by 58.2% over the past year [27] - The company is expanding its offerings and is expected to strengthen net revenues through higher client acquisitions and robust trading activity [26] Evercore - Evercore, a leading independent advisory boutique with a market cap of $10.6 billion, has seen its shares surge by 35.2% over the past year [33] - The company is actively increasing its staff and expanding its advisory solutions, which is expected to support revenue growth in investment banking [31]

Core Viewpoint - The comparison between Evercore (EVR) and Robinhood Markets, Inc. (HOOD) indicates that Evercore presents a better value opportunity for investors at this time due to its stronger earnings outlook and favorable valuation metrics [1][3][7]. Valuation Metrics - Evercore has a forward P/E ratio of 16.35, significantly lower than Robinhood's forward P/E of 34.08, suggesting that Evercore is more attractively priced relative to its earnings potential [5]. - The PEG ratio for Evercore is 0.48, indicating that it is undervalued considering its expected earnings growth, while Robinhood's PEG ratio stands at 1.63, suggesting it may be overvalued [5]. - Evercore's P/B ratio is 5.03, compared to Robinhood's P/B of 7.93, further supporting the notion that Evercore is a more favorable investment based on its book value [6]. Analyst Outlook - Evercore currently holds a Zacks Rank of 2 (Buy), reflecting an improving earnings estimate revision activity, while Robinhood has a Zacks Rank of 3 (Hold), indicating a less favorable analyst outlook [3][7]. - The overall valuation metrics contribute to Evercore's Value grade of B, in contrast to Robinhood's Value grade of F, highlighting the disparity in perceived value between the two stocks [6].

Core Viewpoint - Zacks Premium provides various tools and resources to help investors make informed stock market decisions and invest with confidence [1]. Group 1: Zacks Premium Features - Zacks Premium offers daily updates on Zacks Rank and Zacks Industry Rank, access to the Zacks 1 Rank List, Equity Research reports, and Premium stock screens [1]. - The service includes Zacks Style Scores, which are indicators that assist investors in selecting stocks likely to outperform the market in the next 30 days [2][3]. Group 2: Zacks Style Scores - The Zacks Style Scores categorize stocks into four types: Value Score, Growth Score, Momentum Score, and VGM Score [4][5][6][7]. - Value Score focuses on identifying undervalued stocks using ratios like P/E, PEG, and Price/Sales [4]. - Growth Score emphasizes a company's financial health and future outlook based on projected and historical earnings, sales, and cash flow [5]. - Momentum Score is designed for traders looking to capitalize on price trends, utilizing factors like one-week price change and monthly earnings estimate changes [6]. - VGM Score combines the three Style Scores to identify stocks with attractive value, strong growth forecasts, and promising momentum [7]. Group 3: Zacks Rank and Style Scores Integration - The Zacks Rank is a proprietary model that uses earnings estimate revisions to help investors build successful portfolios, with 1 (Strong Buy) stocks achieving an average annual return of +23.86% since 1988 [8]. - Investors are encouraged to select stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B for the highest likelihood of success [10]. - Stocks with lower ranks, even if they have good Style Scores, may still face downward price trends, indicating a higher risk of price decline [11]. Group 4: Company Spotlight - Evercore (EVR) - Evercore Inc. is a leading independent investment banking advisory firm with a Zacks Rank of 2 (Buy) and a VGM Score of A [12]. - The company has a Value Style Score of B, supported by a forward P/E ratio of 16.98, making it attractive to value investors [12]. - Recent upward revisions in earnings estimates for fiscal 2026 have increased the Zacks Consensus Estimate by $0.68 to $18.52 per share, with an average earnings surprise of +50.9% [13].

Core Viewpoint - Morgan Stanley and Evercore represent two distinct investment banking models, with Morgan Stanley combining advisory and capital markets strength with wealth management, while Evercore focuses on high-margin M&A and restructuring advice [1] Group 1: Morgan Stanley - Morgan Stanley's investment banking fees increased by 23% in 2025 and 35% in 2024, following a decline in 2023 and 2022, indicating a strong recovery in deal-making activity [2][9] - The company's trading business has performed well amid macroeconomic uncertainties, and is expected to continue growing due to decent market volatility and client activity [3] - Morgan Stanley's partnership with Mitsubishi UFJ Financial Group has strengthened its profitability, with Asia region revenues rising 23% year over year to $9.42 billion in 2025 [4] - The wealth and asset management segments contributed nearly 54% to total net revenues in 2025, up from 26% in 2010, with total client assets reaching $9.3 trillion [5] Group 2: Evercore - Evercore, while smaller, has established a significant presence in investment banking, with 97% of its revenues coming from Investment Banking and Equities in 2025 [6] - The company experienced a compound annual growth rate (CAGR) of 10.7% in its Investment Banking and Equities business from 2020 to 2025, supported by a recovery in global M&A activity [7] - Evercore is expanding its investment banking footprint by increasing staff and acquiring firms, such as the U.K.-based advisory firm Robey Warshaw, to enhance its presence in EMEA [8] Group 3: Financial Performance and Valuation - Morgan Stanley's 12-month forward P/E is 14.89X, while Evercore's is 15.88X, indicating that Morgan Stanley is trading at a discount [9][14] - Evercore's return on equity (ROE) stands at 32.01%, outperforming Morgan Stanley's 16.79%, suggesting greater efficiency in generating profits [15] - The Zacks Consensus Estimate for Morgan Stanley's revenues suggests a year-over-year increase of 6% and 4.8% for 2026 and 2027, respectively, while Evercore's estimates indicate a rise of 22.2% and 12.5% for the same years [17][20] Group 4: Investment Outlook - While Evercore shows faster projected growth, Morgan Stanley is viewed as a sturdier option for capital market recovery, benefiting from a strong trading franchise and diversified revenue streams [22][23] - Morgan Stanley's wealth and asset management platform provides durability across economic cycles, making it a favorable choice for investors seeking resilience and upside potential [23]

Revenue and Financial Performance - Total revenues from Investment Banking & Equities and Investment Management segments include fees for services, transaction-related client reimbursements, and other revenue, with net revenues reflecting total revenues less interest expense[169]. - Revenue trends in the advisory business are correlated to M&A activity, restructuring activity, and capital advisory activity, with fluctuations based on market conditions and client transaction completions[171]. - Net Revenues for 2025 were $3.86 billion, an increase of $876.2 million, or 29%, compared to $2.98 billion in 2024[199]. - Advisory Fees increased by $826.5 million, or 34%, to $3.27 billion in 2025, while Underwriting Fees rose by $22.6 million, or 14%[199]. - Net Revenues for 2025 were $3.77 billion, an increase of $869.2 million, or 30%, compared to $2.90 billion in 2024, driven primarily by a 34% increase in Advisory Fees[220]. - Total Number of Fees from Advisory and Underwriting Client Transactions increased to 806 in 2025, up 8% from 748 in 2024, with fees of at least $1 million rising by 16% to 529[219]. - The company recorded a net gain of $25.7 million from its exchange-traded funds portfolio for the year ended December 31, 2025[276]. Expenses - Total Expenses for 2025 were $3.07 billion, an increase of $613.2 million, or 25%, compared to $2.45 billion in 2024[202]. - Employee Compensation and Benefits Expense was $2.50 billion in 2025, reflecting a 27% increase from $1.97 billion in 2024[202]. - Non-Compensation Expenses were $565.0 million in 2025, up 20% from $471.3 million in 2024, driven by increased technology and information services costs[203]. - Interest Expense increased by $7.5 million, or 45%, to $24.3 million in 2025 due to the issuance of new senior notes[201]. - Non-Compensation expenses were $548.3 million in 2025, up 20% from $456.3 million in 2024, primarily due to increased technology and information services expenses[223]. Assets Under Management (AUM) and Wealth Management - Assets Under Management (AUM) in Wealth Management reached $15.5 billion at December 31, 2025, a 12% increase from $13.9 billion at December 31, 2024[231]. - Wealth Management experienced inflows of $1.583 billion and outflows of $1.344 billion in 2025, contributing to a market appreciation of $1.379 billion[234]. - The composition of AUM for Wealth Management as of December 31, 2025, included 67% in equities, 18% in fixed income, 10% in liquidity, and 5% in alternatives[234]. - Wealth Management lagged the S&P 500 by approximately 11% and 5% on a 1 and 3-year basis, respectively[236]. - Wealth Management AUM increased by 12% in 2025, driven by a 10% market appreciation and 2% net inflows[236]. Taxation and Deferred Tax Assets - The provision for income taxes in 2025 was $153.1 million, with an effective tax rate of 19.3%, down from 21.6% in 2024[206]. - The company estimates it must generate approximately $1.8 billion of future taxable income to realize the gross deferred tax asset balance of $446.9 million[321]. - The deferred tax balance is expected to reverse primarily over a period ranging from 5 to 15 taxable years[321]. - The majority of the deferred tax assets relate to the U.S. operations of the company, with management concluding that it is more-likely-than-not the deferred tax assets will be realized[320]. - Significant management judgment is required in determining the provision for income taxes and deferred tax assets and liabilities[316]. Compensation and Incentives - Employee Compensation and Benefits Expense rose to $52.4 million in 2025, a 14% increase from $46.1 million in 2024, due to higher salaries and incentive compensation[240]. - The company anticipates cash distributions to named executive officers in lieu of cash incentive compensation for 2023, 2024, and 2025, reflecting a strategic compensation approach[183]. - The performance period for the 2021 Long-term Incentive Plan ends on December 31, 2024, with cash distributions planned for 2025, indicating a structured incentive framework[185]. Investment and Financial Position - Cash, Cash Equivalents, and Restricted Cash increased to $1.4 billion at December 31, 2025, up $554 million from $882.1 million in 2024[245]. - Operating activities generated a net inflow of $1.3 billion in 2025, primarily related to earnings[245]. - Cash used in investing activities was $98.3 million in 2025, mainly for furniture, equipment, and investment securities[245]. - Financing activities used $635.6 million in cash, primarily for treasury stock purchases and dividend payments[245]. - The company issued $250.0 million in senior notes on July 24, 2025, including $125.0 million of 5.17% Series K Notes and $125.0 million of 5.47% Series L Notes[262]. Risk Management and Credit Quality - The company maintains an allowance for credit losses based on historical credit loss experience and current market conditions, ensuring adequate coverage for probable losses[306]. - The company does not believe it faces any material interest rate risk, foreign currency exchange risk, equity price risk, or other market risk except as disclosed[327]. - The company recorded bad debt expense of $5.6 million for the year ended December 31, 2025, consistent with the previous year, indicating stable credit loss management[306]. - Receivables collection periods are generally within 90 days of invoice, with placement fees collected within 180 days, indicating efficient cash flow management[307]. Accounting and Revenue Recognition - The company applies ASC 606 for revenue recognition, which includes a five-step model to ensure accurate reporting of revenue streams[292]. - Advisory fees are recognized upon the announcement or closing of transactions, which may lead to variability in revenue recognition timing[295]. - Asset management fees are recognized over the period services are provided, based on the value of assets under management, ensuring alignment with performance obligations[304]. - The valuation of investments in securities impacts both the carrying value of direct investments and the determination of management fees, highlighting the importance of fair value assessments[309].