(RTTNews) - Wednesday, Credit Suisse upgraded T. Rowe Price Group, Inc. (TROW: News ) shares to Outperform from Neutral and increased its price target to $60 from $55. The brokerage raised its 2009 fourth quarter EPS estimate to $0.53 from $0.52, and its 2010 estimate to $2.51 from $2.40.

Analyst Siegenthaler upgraded the stock following the meeting with the company's management. The analyst's key conclusions following the meeting are: strong net inflows should continue from both the retail and institutional channels and the operating margin potential is high, as revenue growth exceeds expense growth.

The analyst believes TROW is a best-in-class asset manager, with a repeatable business model for delivering high relative returns and consistent net inflows, even in bear markets. Alternatively, TROW's high relative valuation was the major friction for the analyst's previous Neutral rating.
However, following the pull-back in the stock post-earnings, TROW is now trading modestly under 20x 2010 EPS, and the analyst is using this correction to upgrade his rating as he looks for strong flows in fourth quarter of 2009 and positive EPS revisions in 2010 to drive the stock higher. The analyst's fourth quarter estimate is a cent below consensus, as he forecasts a seasonal pickup in marketing expenses.

Currently, TROW is up $0.97 or 1.92% and trading at $51.55.

To receive FREE breaking news email alerts for T. Rowe Price Group and others in your portfolio

by RTT Staff Writer

For comments and feedback: contact editorial@rttnews.com