We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Affiliated Managers Group Inc.’s (AMG - Free Report) third-quarter 2018 economic earnings of $3.45 per share outpaced the Zacks Consensus Estimate of $3.41. Also, earnings were up 1.2% year over year.
Rise in revenues and growth in assets under management (AUM) from the prior-year quarter benefited results. Also, liquidity position remained strong during the third quarter. However, higher operating expenses were the undermining factor.
Affiliated Managers’ economic net income was $184 million, witnessing a fall of 3.8% from the prior-year quarter.
Revenues & Expenses Rise
Total revenues grew 2.7% year over year to $601.3 million. However, the top line missed the Zacks Consensus Estimate of $607.4 million.
Adjusted earnings before interest, taxes, depreciation and amortization were $237.8 million, down 7.2% from the year-ago quarter.
Total operating expenses increased 8.2% year over year to $421.6 million. The rise was mainly due to an increase in compensation and related expenses, and selling, general and administrative costs.
As of Sep 30, 2018, total AUM was $829.6 billion, up 3.2% year over year. The reported quarter also witnessed net client cash inflow of $0.9 billion.
Capital & Liquidity Position Decent
As of Sep 30, 2018, Affiliated Managers had $448.1 million in cash and cash equivalents compared with $439.5 million as of Dec 31, 2017. Notably, the company had $1.53 billion of senior bank debt, down nearly 1% from the Dec 31, 2017 level.
Shareholders’ equity as of Sep 30, 2018, was $3.62 billion, down from $3.82 billion as of Dec 31, 2017.
Share Repurchase Update
During the reported quarter, the company repurchased 0.8 million shares for $113 million.
Our Take
Affiliated Managers’ muted revenue growth, owing to significant market volatility, remains a major concern. Further, the company has substantial intangible assets that may require impairment, which consequently will have an adverse impact on its financials. Nevertheless, it is well positioned for growth, based on successful partnerships and global distribution capability along with a diverse product mix. Moreover, improving AUM will likely support top-line growth.
Affiliated Managers Group, Inc. Price, Consensus and EPS Surprise
BlackRock’s (BLK - Free Report) third-quarter 2018 adjusted earnings of $7.52 per share outpaced the Zacks Consensus Estimate of $6.93. Results benefited from an improvement in revenues, rise in AUM and steady long-term inflows. The uptick in operating expenses was a dampening factor.
The Blackstone Group L.P. (BX - Free Report) reported third-quarter 2018 economic net income of 76 cents per share, which surpassed the Zacks Consensus Estimate of 73 cents. Results benefited from increase in revenues, which was supported by growth in AUM and inflows.
Invesco Ltd. (IVZ - Free Report) reported third-quarter 2018 adjusted earnings of 66 cents per share, lagging the Zacks Consensus Estimate by a penny. Results were primarily supported by slight revenue growth and rise in AUM. However, increase in operating expenses is an undermining factor.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Image: Bigstock
Affiliated Managers (AMG) Q3 Earnings Beat, Costs Increase
Affiliated Managers Group Inc.’s (AMG - Free Report) third-quarter 2018 economic earnings of $3.45 per share outpaced the Zacks Consensus Estimate of $3.41. Also, earnings were up 1.2% year over year.
Rise in revenues and growth in assets under management (AUM) from the prior-year quarter benefited results. Also, liquidity position remained strong during the third quarter. However, higher operating expenses were the undermining factor.
Affiliated Managers’ economic net income was $184 million, witnessing a fall of 3.8% from the prior-year quarter.
Revenues & Expenses Rise
Total revenues grew 2.7% year over year to $601.3 million. However, the top line missed the Zacks Consensus Estimate of $607.4 million.
Adjusted earnings before interest, taxes, depreciation and amortization were $237.8 million, down 7.2% from the year-ago quarter.
Total operating expenses increased 8.2% year over year to $421.6 million. The rise was mainly due to an increase in compensation and related expenses, and selling, general and administrative costs.
As of Sep 30, 2018, total AUM was $829.6 billion, up 3.2% year over year. The reported quarter also witnessed net client cash inflow of $0.9 billion.
Capital & Liquidity Position Decent
As of Sep 30, 2018, Affiliated Managers had $448.1 million in cash and cash equivalents compared with $439.5 million as of Dec 31, 2017. Notably, the company had $1.53 billion of senior bank debt, down nearly 1% from the Dec 31, 2017 level.
Shareholders’ equity as of Sep 30, 2018, was $3.62 billion, down from $3.82 billion as of Dec 31, 2017.
Share Repurchase Update
During the reported quarter, the company repurchased 0.8 million shares for $113 million.
Our Take
Affiliated Managers’ muted revenue growth, owing to significant market volatility, remains a major concern. Further, the company has substantial intangible assets that may require impairment, which consequently will have an adverse impact on its financials. Nevertheless, it is well positioned for growth, based on successful partnerships and global distribution capability along with a diverse product mix. Moreover, improving AUM will likely support top-line growth.
Affiliated Managers Group, Inc. Price, Consensus and EPS Surprise
Affiliated Managers Group, Inc. Price, Consensus and EPS Surprise | Affiliated Managers Group, Inc. Quote
Affiliated Managers currently 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 Asset Managers
BlackRock’s (BLK - Free Report) third-quarter 2018 adjusted earnings of $7.52 per share outpaced the Zacks Consensus Estimate of $6.93. Results benefited from an improvement in revenues, rise in AUM and steady long-term inflows. The uptick in operating expenses was a dampening factor.
The Blackstone Group L.P. (BX - Free Report) reported third-quarter 2018 economic net income of 76 cents per share, which surpassed the Zacks Consensus Estimate of 73 cents. Results benefited from increase in revenues, which was supported by growth in AUM and inflows.
Invesco Ltd. (IVZ - Free Report) reported third-quarter 2018 adjusted earnings of 66 cents per share, lagging the Zacks Consensus Estimate by a penny. Results were primarily supported by slight revenue growth and rise in AUM. However, increase in operating expenses is an undermining factor.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>