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SEI Investments (SEIC) Q3 Earnings & Revenues Beat, AUM Up
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SEI Investments Co. (SEIC - Free Report) reported third-quarter 2017 earnings of 63 cents per share, surpassing the Zacks Consensus Estimate of 57 cents. Also, the bottom line improved 19% from the prior-year quarter.
Results benefitted from an increase in total revenues, partly offset by higher operating expenses. Improvement in assets under management (AUM) also acted as a tailwind.
Net income for the quarter came in at $101.7 million, increasing 17% from the year-ago period.
Revenues and AUM Improve, Expenses Rise
Total revenues grew 9% year over year to $386 million. The rise mainly reflected an increase in asset management, administration and distribution fees. Further, the figure marginally surpassed the Zacks Consensus Estimate of $385.8 million.
Total expenses were $286.8 million increasing 11% year over year. All cost components other than brokerage commissions, and software royalties and other information processing costs recorded an upside.
Operating income rose 2% year over year to $99.2 million.
As of Sep 30, 2017, AUM was $325.04 billion, up 16% from the prior-year quarter. Total client AUM was $515.6 billion, increasing 10% year over year. Note that client AUM does not include $11.1 billion related to Funds of Funds assets that were reported on Sep 30, 2017.
Share Repurchase
In the reported quarter, SEI Investments bought back 1.2 million shares for $68.2 million.
Further, the company approved an additional $200 million share buyback authorization. This brings the total authorization to nearly $230.5 million.
Our Take
SEI Investments’ innovative and diverse global investment products and services position it well to grow organically. Also, robust asset growth and acquisition of Archway Technology Partners will continue to support profitability. Further, impressive capital deployment activities are likely to enhance shareholder value.
However, elevated expenses and increased reliance on fee-based revenues remain primary concerns for the company.
SEI Investments Company Price, Consensus and EPS Surprise
The Blackstone Group L.P. (BX - Free Report) reported third-quarter 2017 economic net income of 69 cents per share, which beat the Zacks Consensus Estimate of 57 cents. Improvement in revenues largely boosted earnings. However, a rise in expenses was an undermining factor.
BlackRock, Inc. (BLK - Free Report) reported third-quarter 2017 adjusted earnings of $5.92 per share, which outpaced the Zacks Consensus Estimate of $5.59. Results benefited from improvement in revenues, rise in AUM and steady long-term inflows. However, increase in operating expenses acted as a headwind.
Waddell & Reed Financial Inc.’s third-quarter 2017 earnings of 45 cents per share outpaced the Zacks Consensus Estimate of 40 cents. Higher gross sales and a decline in net outflows marginally supported the results. However, lower revenues and a rise in expenses were the undermining factors.
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SEI Investments (SEIC) Q3 Earnings & Revenues Beat, AUM Up
SEI Investments Co. (SEIC - Free Report) reported third-quarter 2017 earnings of 63 cents per share, surpassing the Zacks Consensus Estimate of 57 cents. Also, the bottom line improved 19% from the prior-year quarter.
Results benefitted from an increase in total revenues, partly offset by higher operating expenses. Improvement in assets under management (AUM) also acted as a tailwind.
Net income for the quarter came in at $101.7 million, increasing 17% from the year-ago period.
Revenues and AUM Improve, Expenses Rise
Total revenues grew 9% year over year to $386 million. The rise mainly reflected an increase in asset management, administration and distribution fees. Further, the figure marginally surpassed the Zacks Consensus Estimate of $385.8 million.
Total expenses were $286.8 million increasing 11% year over year. All cost components other than brokerage commissions, and software royalties and other information processing costs recorded an upside.
Operating income rose 2% year over year to $99.2 million.
As of Sep 30, 2017, AUM was $325.04 billion, up 16% from the prior-year quarter. Total client AUM was $515.6 billion, increasing 10% year over year. Note that client AUM does not include $11.1 billion related to Funds of Funds assets that were reported on Sep 30, 2017.
Share Repurchase
In the reported quarter, SEI Investments bought back 1.2 million shares for $68.2 million.
Further, the company approved an additional $200 million share buyback authorization. This brings the total authorization to nearly $230.5 million.
Our Take
SEI Investments’ innovative and diverse global investment products and services position it well to grow organically. Also, robust asset growth and acquisition of Archway Technology Partners will continue to support profitability. Further, impressive capital deployment activities are likely to enhance shareholder value.
However, elevated expenses and increased reliance on fee-based revenues remain primary concerns for the company.
SEI Investments Company Price, Consensus and EPS Surprise
SEI Investments Company Price, Consensus and EPS Surprise | SEI Investments Company Quote
Currently, SEI Investments carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Investment Managers
The Blackstone Group L.P. (BX - Free Report) reported third-quarter 2017 economic net income of 69 cents per share, which beat the Zacks Consensus Estimate of 57 cents. Improvement in revenues largely boosted earnings. However, a rise in expenses was an undermining factor.
BlackRock, Inc. (BLK - Free Report) reported third-quarter 2017 adjusted earnings of $5.92 per share, which outpaced the Zacks Consensus Estimate of $5.59. Results benefited from improvement in revenues, rise in AUM and steady long-term inflows. However, increase in operating expenses acted as a headwind.
Waddell & Reed Financial Inc.’s third-quarter 2017 earnings of 45 cents per share outpaced the Zacks Consensus Estimate of 40 cents. Higher gross sales and a decline in net outflows marginally supported the results. However, lower revenues and a rise in expenses were the undermining factors.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>