Invesco’s (IVZ - Free Report) third-quarter 2023 adjusted earnings of 35 cents per share lagged the Zacks Consensus Estimate of 36 cents. The bottom line, however, rose 2.9% from the prior-year quarter.
Results were hurt by a rise in operating expenses and lower revenues. Nevertheless, an increase in assets under management (AUM) balance on decent inflows aided the results to some extent.
On a GAAP basis, net income attributable to common shareholders was $131.4 million or 29 cents per share, down from $177.4 million or 39 cents per share a year ago. Our estimate for net income was $153.8 million.
Revenues Decline, Expenses Rise
Adjusted quarterly net revenues were $1.1 billion, falling 1.1% year over year. The top line marginally beat the Zacks Consensus Estimate of $1.09 billion.
Adjusted operating expenses were $789 million, up 6.4% year over year. We expected the metric to be $777.8 million.
The adjusted operating margin was 28.2%, down from 33.3% a year ago.
AUM Balance Increases
As of Sep 30, 2023, AUM was $1.49 trillion, which increased 12.4% year over year. Average AUM at the third-quarter end totaled $1.53 trillion, up 7.9%. Our estimates for total AUM and average AUM were $1.56 trillion and $1.55 trillion, respectively.
The company witnessed long-term net inflows of $2.6 billion in the quarter.
Balance Sheet Strong
As of Sep 30, 2023, cash and cash equivalents were $1.24 billion compared with $1.01 billion as of Jun 30, 2023.
Long-term debt was $1.49 billion. The credit facility balance was nil as of Sep 30, 2023.
Share Repurchase Update
During the reported quarter, Invesco repurchased shares worth $90 million.
Our View
Invesco is well-poised to benefit from its global footprint, product offerings and strategic buyouts. However, elevated expenses, a challenging market environment and high debt levels are major near-term concerns.
Currently, IVZ carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance & Earnings Release Date of Other Asset Managers
BlackRock, Inc.’s (BLK - Free Report) third-quarter 2023 adjusted earnings of $10.91 per share handily surpassed the Zacks Consensus Estimate of $8.52. Also, the figure reflects an increase of 14.2% from the year-ago quarter.
Results have benefited from a rise in revenues and higher non-operating income. Further, the AUM balance witnessed improvement. However, higher expenses acted as a headwind for BLK.
Ameriprise Financial (AMP - Free Report) is slated to report third-quarter 2023 results on Oct 25.
Over the past 30 days, the Zacks Consensus Estimate for AMP’s quarterly earnings has moved almost 1% lower to $7.58. The figure indicates a 17.9% rise from the prior-year quarter.
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Invesco’s (IVZ - Free Report) third-quarter 2023 adjusted earnings of 35 cents per share lagged the Zacks Consensus Estimate of 36 cents. The bottom line, however, rose 2.9% from the prior-year quarter.
Results were hurt by a rise in operating expenses and lower revenues. Nevertheless, an increase in assets under management (AUM) balance on decent inflows aided the results to some extent.
On a GAAP basis, net income attributable to common shareholders was $131.4 million or 29 cents per share, down from $177.4 million or 39 cents per share a year ago. Our estimate for net income was $153.8 million.
Revenues Decline, Expenses Rise
Adjusted quarterly net revenues were $1.1 billion, falling 1.1% year over year. The top line marginally beat the Zacks Consensus Estimate of $1.09 billion.
Adjusted operating expenses were $789 million, up 6.4% year over year. We expected the metric to be $777.8 million.
The adjusted operating margin was 28.2%, down from 33.3% a year ago.
AUM Balance Increases
As of Sep 30, 2023, AUM was $1.49 trillion, which increased 12.4% year over year. Average AUM at the third-quarter end totaled $1.53 trillion, up 7.9%. Our estimates for total AUM and average AUM were $1.56 trillion and $1.55 trillion, respectively.
The company witnessed long-term net inflows of $2.6 billion in the quarter.
Balance Sheet Strong
As of Sep 30, 2023, cash and cash equivalents were $1.24 billion compared with $1.01 billion as of Jun 30, 2023.
Long-term debt was $1.49 billion. The credit facility balance was nil as of Sep 30, 2023.
Share Repurchase Update
During the reported quarter, Invesco repurchased shares worth $90 million.
Our View
Invesco is well-poised to benefit from its global footprint, product offerings and strategic buyouts. However, elevated expenses, a challenging market environment and high debt levels are major near-term concerns.
Currently, IVZ carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance & Earnings Release Date of Other Asset Managers
BlackRock, Inc.’s (BLK - Free Report) third-quarter 2023 adjusted earnings of $10.91 per share handily surpassed the Zacks Consensus Estimate of $8.52. Also, the figure reflects an increase of 14.2% from the year-ago quarter.
Results have benefited from a rise in revenues and higher non-operating income. Further, the AUM balance witnessed improvement. However, higher expenses acted as a headwind for BLK.
Ameriprise Financial (AMP - Free Report) is slated to report third-quarter 2023 results on Oct 25.
Over the past 30 days, the Zacks Consensus Estimate for AMP’s quarterly earnings has moved almost 1% lower to $7.58. The figure indicates a 17.9% rise from the prior-year quarter.
Research Chief Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.
Free: See Our Top Stock And 4 Runners Up
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