At least seven research firms initiated coverage of MF Global Ltd. (NYSE: MF) this morning, with the majority of the ratings favorable, based on expectations for the company to benefit from the havoc in the financial markets.
MF Global, which had a disappointing trading debut last month at $30, is a broker of exchange-listed futures and options for over 130,000 clients. Shares now trade at $26.55 in late-day trading today.
JP Morgan, who initiated MF Global with an Overweight rating, expects volume and volatility in the current market will to create earnings growth in the longer-term. However, some analysts are concerned with MF Global's competition. Deutsche Bank initiated shares of MF with a Hold rating, citing concerns over falling commission rates in a falling interest rate environment, which could pressure the company's growth. Analysts from Wachovia initiated coverage of the derivatives brokerage firm with a Market Perform rating, while Citigroup started coverage with a Hold rating.
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