WisdomTree Investments Downgraded At KBW; Still A 'Long-Term Pure Play'

In a report published Monday, Keefe, Bruyette & Woods analyst Robert Lee downgraded the rating on WisdomTree Investments, Inc. (NASDAQ: WETF) from Outperform to Market Perform, with a $25 price target. The analyst believes that the risk/reward profile of the stock is less favorable, given the current share price.

The analyst also noted that AUM, as of June 18, stood at $62.5 billion, which was below the current quarter-end estimate. In addition, the quarter-to-date flows were robust, as of June 12, at $6.3 billion, although again significantly below the estimate.

"As flows to currency hedged strategies have slowed since the start of the quarter, this has been only partially offset by flows into Developed Equity and Emerging Markets," Lee explained.

The analyst also believes that the company's organic growth continues to be highly leveraged to demand for WisdomTree's currency hedged strategies to work. At the same time, the analyst also viewed the stock as a "long-term pure play," given its ETF growth.