A month has gone by since the last earnings report for Janus Capital Group, Inc . Shares have added about 8.8% in the past month, outperforming the market.
Will the recent positive trend continue leading up to the stock's next earnings release, or is it due for a pullback? Before we dive into how investors and analysts have reacted of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Janus Capital's Q1 Earnings Beat on High Revenues
Janus Capital recorded a positive earnings surprise of 9.5% in first-quarter 2017. The company reported adjusted earnings per share of $0.23, beating the Zacks Consensus Estimate of $0.21. In addition, results came above the prior-year quarter figure of $0.19.
Better-than-expected results reflect increase in revenues. Moreover, increase in AUM was another positive point. However, a rise in operating expenses was a concern.
Including one-time items, net income came in at $30.9 million, or $0.17 per share compared with net income of $35.1 million, or $0.19 per share in the prior-year quarter.
Revenues Rise, Expenses Flare Up
Total revenue increased 3.7% year over year to $257.6 million in the quarter, primarily on the back of higher investment management, partially offset by higher negative performance fees. However, revenues missed the Zacks Consensus Estimate of $259.4 million.
Total operating expenses increased 8.8% on a year-over-year basis to $202.3 million in the quarter. The increase was the result of a rise in almost all categories of expenses, partially offset by a fall in long-term incentive compensation, and reduced depreciation and amortization.
Strong Asset Position
Average AUM increased to $201.4 billion from $180.2 billion in the year-ago quarter and from $191.9 billion in the preceding quarter.
As of Mar 31, 2017, Janus Capital reported total AUM of $204.7 billion, up from $191.3 billion as of Mar 31, 2016 and $196.8 billion as of Dec 31, 2016.
Notably, the reported quarter witnessed a sequential increase in complex-wide assets, exhibiting net market appreciation of $12.1 billion, partly offset by long-term net outflows of $4.7 billion. Fundamental equity, Mathematical equity and fixed income long-term net outflows summed $0.6 billion, $3.8 billion and $0.3 billion, respectively.
Stable Balance Sheet
As of Mar 31, 2017, Janus Capital had stockholders’ equity of $1.66 billion, cash and investments of $655.8 million and outstanding debt of $407.4 million compared with stockholders’ equity of $1.69 billion, cash and investments of $608.4 million and outstanding debt of $403.3 million at the end of the prior-year quarter.
Cash flow from operations in the reported quarter was negative $50.1 million compared with negative $44.0 million in first-quarter 2016.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended upward during the past month. There have been three revisions higher for the current quarter
VGM Scores
At this time, Janus Capital's stock has a poor Growth Score of 'F', however its Momentum is doing a lot better with a 'C'. Charting the same path, the stock was allocated a grade of 'C' on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'D'. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is suitable for momentum investors and value investors.
Outlook
Estimates have been trending upward for the stock. The magnitude of these revisions also looks promising. Notably, the stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.
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Janus Capital (JNS) Up 8.8% Since Earnings Report: Can It Continue?
A month has gone by since the last earnings report for Janus Capital Group, Inc . Shares have added about 8.8% in the past month, outperforming the market.
Will the recent positive trend continue leading up to the stock's next earnings release, or is it due for a pullback? Before we dive into how investors and analysts have reacted of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Janus Capital's Q1 Earnings Beat on High Revenues
Janus Capital recorded a positive earnings surprise of 9.5% in first-quarter 2017. The company reported adjusted earnings per share of $0.23, beating the Zacks Consensus Estimate of $0.21. In addition, results came above the prior-year quarter figure of $0.19.
Better-than-expected results reflect increase in revenues. Moreover, increase in AUM was another positive point. However, a rise in operating expenses was a concern.
Including one-time items, net income came in at $30.9 million, or $0.17 per share compared with net income of $35.1 million, or $0.19 per share in the prior-year quarter.
Revenues Rise, Expenses Flare Up
Total revenue increased 3.7% year over year to $257.6 million in the quarter, primarily on the back of higher investment management, partially offset by higher negative performance fees. However, revenues missed the Zacks Consensus Estimate of $259.4 million.
Total operating expenses increased 8.8% on a year-over-year basis to $202.3 million in the quarter. The increase was the result of a rise in almost all categories of expenses, partially offset by a fall in long-term incentive compensation, and reduced depreciation and amortization.
Strong Asset Position
Average AUM increased to $201.4 billion from $180.2 billion in the year-ago quarter and from $191.9 billion in the preceding quarter.
As of Mar 31, 2017, Janus Capital reported total AUM of $204.7 billion, up from $191.3 billion as of Mar 31, 2016 and $196.8 billion as of Dec 31, 2016.
Notably, the reported quarter witnessed a sequential increase in complex-wide assets, exhibiting net market appreciation of $12.1 billion, partly offset by long-term net outflows of $4.7 billion. Fundamental equity, Mathematical equity and fixed income long-term net outflows summed $0.6 billion, $3.8 billion and $0.3 billion, respectively.
Stable Balance Sheet
As of Mar 31, 2017, Janus Capital had stockholders’ equity of $1.66 billion, cash and investments of $655.8 million and outstanding debt of $407.4 million compared with stockholders’ equity of $1.69 billion, cash and investments of $608.4 million and outstanding debt of $403.3 million at the end of the prior-year quarter.
Cash flow from operations in the reported quarter was negative $50.1 million compared with negative $44.0 million in first-quarter 2016.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended upward during the past month. There have been three revisions higher for the current quarter
Janus Capital Group, Inc Price and Consensus
Janus Capital Group, Inc Price and Consensus | Janus Capital Group, Inc Quote
VGM Scores
At this time, Janus Capital's stock has a poor Growth Score of 'F', however its Momentum is doing a lot better with a 'C'. Charting the same path, the stock was allocated a grade of 'C' on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'D'. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is suitable for momentum investors and value investors.
Outlook
Estimates have been trending upward for the stock. The magnitude of these revisions also looks promising. Notably, the stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.