AllianceBernstein Holding (NYSE:AB) is an investment firm that provides research, investment management and related services around the world. As the bull market continues to gain momentum and investors come out of their shells, companies like AB are going to be front-and-center for the next several years.
And it’s not just U.S. investors that AllianceBernstein serves. The company has operations in 23 countries, from Japan to Germany to the U.K.
The downside risk is that, of course, AllianceBernstein is a very cyclical business. A turn in investor sentiment could result in big-time outflows from its money management operations. Consider the stock remains about 65% below where it was five years ago, before the markets were gutted by the financial crisis.
There’s also the risk that both retail and institutional investors will simply move their money elsewhere to other firms. That’s what we saw in 2011, when the stock went from $22 to a low of less than $12 after it lost accounts with Vanguard and other big names.
But AB has clawed its way back and is just paid its biggest quarterly dividend since 2010. Its strong brand name, lengthy history and massive $430 billion in assets under management mean this company isn’t going anywhere.