Janus Henderson Group (JHG) appears undervalued in the $7.4 billion all-cash acquisition deal with Trian Partners and General Catalyst, BofA Securities said in a note Monday.

The brokerage said the purchase price of $49 per share is 9% below its prior $54 price target and looks even cheaper on an enterprise value to earnings before interest, taxes, depreciation, and amortization basis due to Janus Henderson's strong cash position.

"We saw hidden value and were bullish on CEO's new strategy," BofA said, as it listed "tangible" improvements in fund flows, investment performance, and product offerings through mergers and acquisitions, as well as in the company's insurance investment management agreement with Guardian Life.

There have also been improvements in company culture, distribution strategy, and talent, according to the note.

BofA downgraded Janus Henderson Group to neutral from buy, and reduced its price target to $49 from $54.

Price: 47.92, Change: +0.14, Percent Change: +0.29