BlackRock, Inc.’s (BLK - Free Report) fourth-quarter 2022 adjusted earnings of $8.93 per share surpassed the Zacks Consensus Estimate of $7.99. The figure reflects a decrease of 16.4% from the year-ago quarter.
The quarterly results benefited from a decline in expenses. However, lower revenues and assets under management (AUM) balance were the major headwinds.
Net income attributable to BlackRock (on a GAAP basis) was $1.26 billion, down 23.4% from the prior-year quarter.
In 2022, adjusted earnings per share of $35.36 declined 12.7% year over year but beat the consensus estimate of $34.44. Net income attributable to BlackRock (on a GAAP basis) was $5.18 billion, down 12.3%.
Revenues & Expenses Decline
Revenues (on a GAAP basis) in the quarter were $4.34 billion, beating the Zacks Consensus Estimate of $4.16 billion. However, the figure fell 15.1% year over year. The decline largely stemmed from a decrease in almost all components of revenues, except for technology services revenues.
In 2022, revenues (GAAP basis) declined 7.7% to $17.87 billion. The top line surpassed the consensus estimate of $17.71 billion.
Total expenses amounted to $2.91 billion, down 5.1% from the prior-year quarter. The decline was due to a fall in all cost components except for general and administrative expenses. The quarter number also included restructuring charges of $91 million related to the modification of “the size and shape of the workforce to align more closely with strategic priorities.”
Non-operating income (on a GAAP basis) was $225 million, significantly up from $71 million in the year-ago quarter.
BlackRock’s adjusted operating income was $1.58 billion, down 25.2% from the prior-year period.
AUM Balance Dips
As of Dec 31, 2022, AUM totaled $8.59 trillion, reflecting a year-over-year fall of 14.1%. In the reported quarter, the company witnessed long-term net inflows of $145.7 billion. However, unfavorable market change and FX impact hurt the AUM balance.
Average AUM of $8.42 trillion as of Dec 31, 2022, declined 13.7% year over year.
Share Repurchase Update
BlackRock repurchased shares worth $1.9 billion in 2022.
Our View
BLK’s continued efforts to strengthen the iShares and ETF operations, along with its initiatives to restructure the actively-managed equity business, are expected to remain tailwinds. However, the uncertain markets and extreme volatility on the back of macroeconomic concerns have led to an unfavorable operating backdrop for the company.
BlackRock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings Dates & Expectations of Other Asset Managers
Invesco Ltd. (IVZ - Free Report) is scheduled to announce fourth-quarter 2022 numbers on Jan 24.
Over the past month, the Zacks Consensus Estimate for IVZ’s quarterly earnings has moved 2.9% northward to 35 cents. However, it implies a 59.3% decline from the prior-year reported number.
Ameriprise Financial, Inc. (AMP - Free Report) is slated to report fourth-quarter 2022 results on Jan 25.
Over the past 30 days, the Zacks Consensus Estimate for AMP’s quarterly earnings has moved marginally lower to $6.35. Nonetheless, it indicates a 3.58% rise from the prior-year quarter.
Where Will Stocks Go…
If Biden Wins? If Trump Wins?
The answers may surprise you.
Since 1950, even after negative midterm years, the market has never had a lower presidential election year. With voters energized and engaged, the market has been almost unrelentingly bullish no matter which party wins!
Now is the time to download Zacks' free Special Report with 5 stocks that offer extreme upside for both Democrats and Republicans…
1. Medical manufacturer has gained +11,000% in the last 15 years.
2. Rental company is absolutely crushing its sector.
3. Energy powerhouse plans to grow its already large dividend by 25%.
4. Aerospace and defense standout just landed a potentially $80 billion contract.
5. Giant Chipmaker is building huge plants in the U.S.
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BlackRock, Inc.’s (BLK - Free Report) fourth-quarter 2022 adjusted earnings of $8.93 per share surpassed the Zacks Consensus Estimate of $7.99. The figure reflects a decrease of 16.4% from the year-ago quarter.
The quarterly results benefited from a decline in expenses. However, lower revenues and assets under management (AUM) balance were the major headwinds.
Net income attributable to BlackRock (on a GAAP basis) was $1.26 billion, down 23.4% from the prior-year quarter.
In 2022, adjusted earnings per share of $35.36 declined 12.7% year over year but beat the consensus estimate of $34.44. Net income attributable to BlackRock (on a GAAP basis) was $5.18 billion, down 12.3%.
Revenues & Expenses Decline
Revenues (on a GAAP basis) in the quarter were $4.34 billion, beating the Zacks Consensus Estimate of $4.16 billion. However, the figure fell 15.1% year over year. The decline largely stemmed from a decrease in almost all components of revenues, except for technology services revenues.
In 2022, revenues (GAAP basis) declined 7.7% to $17.87 billion. The top line surpassed the consensus estimate of $17.71 billion.
Total expenses amounted to $2.91 billion, down 5.1% from the prior-year quarter. The decline was due to a fall in all cost components except for general and administrative expenses. The quarter number also included restructuring charges of $91 million related to the modification of “the size and shape of the workforce to align more closely with strategic priorities.”
Non-operating income (on a GAAP basis) was $225 million, significantly up from $71 million in the year-ago quarter.
BlackRock’s adjusted operating income was $1.58 billion, down 25.2% from the prior-year period.
AUM Balance Dips
As of Dec 31, 2022, AUM totaled $8.59 trillion, reflecting a year-over-year fall of 14.1%. In the reported quarter, the company witnessed long-term net inflows of $145.7 billion. However, unfavorable market change and FX impact hurt the AUM balance.
Average AUM of $8.42 trillion as of Dec 31, 2022, declined 13.7% year over year.
Share Repurchase Update
BlackRock repurchased shares worth $1.9 billion in 2022.
Our View
BLK’s continued efforts to strengthen the iShares and ETF operations, along with its initiatives to restructure the actively-managed equity business, are expected to remain tailwinds. However, the uncertain markets and extreme volatility on the back of macroeconomic concerns have led to an unfavorable operating backdrop for the company.
BlackRock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings Dates & Expectations of Other Asset Managers
Invesco Ltd. (IVZ - Free Report) is scheduled to announce fourth-quarter 2022 numbers on Jan 24.
Over the past month, the Zacks Consensus Estimate for IVZ’s quarterly earnings has moved 2.9% northward to 35 cents. However, it implies a 59.3% decline from the prior-year reported number.
Ameriprise Financial, Inc. (AMP - Free Report) is slated to report fourth-quarter 2022 results on Jan 25.
Over the past 30 days, the Zacks Consensus Estimate for AMP’s quarterly earnings has moved marginally lower to $6.35. Nonetheless, it indicates a 3.58% rise from the prior-year quarter.
Where Will Stocks Go…
If Biden Wins? If Trump Wins?
The answers may surprise you.
Since 1950, even after negative midterm years, the market has never had a lower presidential election year. With voters energized and engaged, the market has been almost unrelentingly bullish no matter which party wins!
Now is the time to download Zacks' free Special Report with 5 stocks that offer extreme upside for both Democrats and Republicans…
1. Medical manufacturer has gained +11,000% in the last 15 years.
2. Rental company is absolutely crushing its sector.
3. Energy powerhouse plans to grow its already large dividend by 25%.
4. Aerospace and defense standout just landed a potentially $80 billion contract.
5. Giant Chipmaker is building huge plants in the U.S.
Hurry, Download Special Report FREE >>
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