Wall Street Analysts Say Sell on This Stock. Here’s Why They’re Wrong.

For a pure play asset administration agency like T. Rowe Price (TROW +1.56%)its fortunes are going to largely be tied to the fluctuations of the inventory market.

When shares are up and markets are rising, T. Rowe Price goes to do properly, as a result of its charges are primarily tied to belongings beneath administration of their institutional separate accounts, mutual funds, and exchange-traded funds (ETFs). When markets are up, there’s usually extra funding movement into their funds, as a result of traders typically chase returns. This additionally serves to lift asset ranges, charges, and income.

When markets are down, the alternative is true. Assets ranges depreciate, so charges go down, and infrequently, fund flows decelerate.

So, with markets down in 2026, it ought to come as no shock that T. Rowe Price inventory is down yr thus far by about 10%.

Wall Street analysts have a detrimental view of the inventory, based mostly on a number of components. The main concern was that T. Rowe Price reported $25.5 billion in outflows within the fourth quarter. That probably needed to do with the down market in This fall and traders cashing out. But the corporate additionally reported a 16.5% enhance in working bills, which induced it to overlook estimates.

As of April 10, some 33% of analysts had rated T. Rowe Price stock a promote, with solely 7% calling it a purchase. The lion’s share of analysts, 60%, rated it a maintain.

I are inclined to agree with the minority, as I believe T. Rowe Price is a strong purchase proper now. Here’s why.

An outstanding dividend inventory

I get why analysts is perhaps afraid of T. Rowe Price, given the truth that markets are down this yr and the outlook for 2026 could be very unsure. That may end in restricted upside for the inventory.

However, it’s the kind of market the place traders are flocking to dividend shares, and it’s possible you’ll not discover many higher dividend shares than T. Rowe Price.

Today’s Change

(1.56%)$1.47

Current Price

$95.84

Key Data Points

Market Cap

$21B

Day’s Range

$94.56 – $96.34

52wk Range

$82.86 – $118.22

Volume

67

Avg Vol

2.4M

Gross Margin

78.89%

Dividend Yield

5.33%

The firm has elevated its dividend for 40 straight years, together with a 2% enhance in January to $1.30 per share. Over the previous 5 years, it has grown its dividend at a price of about 6% per yr. It additionally has a really manageable payout ratio of 52%. The motive that T. Rowe Price has been capable of persistently enhance its dividend yr after yr is due to its fortress steadiness sheet.

The firm has no long-term debt, and solely about $469 million in short-term debt. It has a minuscule debt-to-equity ratio of three.89%. It additionally had $2 billion in free money movement in 2025 and ended the yr with $3.8 billion in money and equivalents. That is a recipe for a soon-to-be Dividend King.

In addition, it has a ridiculously high dividend yield of 5.64%. Of all of the shares which have elevated their dividend for greater than 25 straight years, T. Rowe Price’s yield is the second highest.

Active administration again in vogue

There are a pair different issues to notice about T. Rowe Price. One, he’s recognized primarily as an energetic supervisor, and in the course of the bull market, he took a again seat to the massive indexers that supplied sturdy returns with low bills. But with the kind of market uncertainty and rotation we’re seeing now, its penchant for inventory choosing may give it a bonus.

While it was late in providing ETFs, it now has a full roster of energetic ETFs with five-year observe data. That ought to put it on the radar of extra traders, significantly institutional traders, which require longer observe data.

Overall, for its nice dividend alone, T. Rowe Price is a purchase for revenue traders. But it may additionally stand out amongst its friends because the bull market morphs into one thing which may favor energetic administration.