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Rise in Assets Balance to Support Invesco (IVZ) Q1 Earnings
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Invesco (IVZ - Free Report) is scheduled to report first-quarter 2021 results on Apr 27, before market open. While its earnings are expected to have witnessed a rise in the to-be-reported quarter, revenues are projected to have declined on a year-over-year basis.
In the last reported quarter, the company’s adjusted earnings beat the Zacks Consensus Estimate. A decrease in operating expenses and net inflows were the major tailwinds.
Invesco does not have an impressive earnings surprise history. Its earnings surpassed the Zacks Consensus Estimate in two of the trailing four quarters.
The Zacks Consensus Estimate for Invesco’s earnings of 57 cents has been revised 5.1% upward over the past 30 days. Also, the figure indicates a jump of 82.4% from the year-ago quarter’s reported number.
The consensus estimate for sales is pegged at $1.21 billion, which suggests an 24.2% decline.
Before we take a look at what our quantitative model predicts, let’s check the factors that are expected to have influenced Invesco’s first-quarter performance.
Per the monthly metrics data published by Invesco, preliminary total AUM as of Mar 31, 2021, was $1,404.1 billion, up 4% from the Dec 31, 2020 level. The sequential rise was mainly driven by net inflows and upbeat markets.
Thus, supported by growth in assets, the company’s investment management fee might have been positively impacted. The Zacks Consensus Estimate for the same is pegged at $1.2 billion, indicating 4.3% growth from the prior-quarter number.
Further, the consensus estimate for service and distribution fees of $391 million indicates a 6.3% rise.
Management expects operating revenues (excluding performance fees) and the associated variable expenses to be modestly higher on a sequential basis.
On the cost front, while Invesco’s initiatives to manage costs have helped in improving its efficiency, continued rise in compensation and marketing costs has led to an increase in overall expenses over the past few years. The same trend is expected to have continued in the first quarter as well.
What Our Model Predicts
Per the Zacks model, the chances of Invesco beating the Zacks Consensus Estimate this time are high. This is because it has the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or better.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: The Earnings ESP for Invesco is +1.06%.
Zacks Rank: The company currently carries a Zacks Rank #3.
Other Finance Stocks That Warrant a Look
Here are some other finance stocks that you may want to consider as these have the right combination of elements to post an earnings beat in their upcoming releases, per our model.
The Earnings ESP for Capital One (COF - Free Report) is +4.01% and it carries a Zacks Rank #3 at present. The company is slated to report quarterly numbers on Apr 27.
The Earnings ESP for Prosperity Bancshares, Inc. (PB - Free Report) is +2.56% and it carries a Zacks Rank #3, currently. The company is scheduled to report quarterly numbers on Apr 28.
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Rise in Assets Balance to Support Invesco (IVZ) Q1 Earnings
Invesco (IVZ - Free Report) is scheduled to report first-quarter 2021 results on Apr 27, before market open. While its earnings are expected to have witnessed a rise in the to-be-reported quarter, revenues are projected to have declined on a year-over-year basis.
In the last reported quarter, the company’s adjusted earnings beat the Zacks Consensus Estimate. A decrease in operating expenses and net inflows were the major tailwinds.
Invesco does not have an impressive earnings surprise history. Its earnings surpassed the Zacks Consensus Estimate in two of the trailing four quarters.
Invesco Ltd. Price and EPS Surprise
Invesco Ltd. price-eps-surprise | Invesco Ltd. Quote
The Zacks Consensus Estimate for Invesco’s earnings of 57 cents has been revised 5.1% upward over the past 30 days. Also, the figure indicates a jump of 82.4% from the year-ago quarter’s reported number.
The consensus estimate for sales is pegged at $1.21 billion, which suggests an 24.2% decline.
Before we take a look at what our quantitative model predicts, let’s check the factors that are expected to have influenced Invesco’s first-quarter performance.
Per the monthly metrics data published by Invesco, preliminary total AUM as of Mar 31, 2021, was $1,404.1 billion, up 4% from the Dec 31, 2020 level. The sequential rise was mainly driven by net inflows and upbeat markets.
Thus, supported by growth in assets, the company’s investment management fee might have been positively impacted. The Zacks Consensus Estimate for the same is pegged at $1.2 billion, indicating 4.3% growth from the prior-quarter number.
Further, the consensus estimate for service and distribution fees of $391 million indicates a 6.3% rise.
Management expects operating revenues (excluding performance fees) and the associated variable expenses to be modestly higher on a sequential basis.
On the cost front, while Invesco’s initiatives to manage costs have helped in improving its efficiency, continued rise in compensation and marketing costs has led to an increase in overall expenses over the past few years. The same trend is expected to have continued in the first quarter as well.
What Our Model Predicts
Per the Zacks model, the chances of Invesco beating the Zacks Consensus Estimate this time are high. This is because it has the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or better.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: The Earnings ESP for Invesco is +1.06%.
Zacks Rank: The company currently carries a Zacks Rank #3.
Other Finance Stocks That Warrant a Look
Here are some other finance stocks that you may want to consider as these have the right combination of elements to post an earnings beat in their upcoming releases, per our model.
The Earnings ESP for Capital One (COF - Free Report) is +4.01% and it carries a Zacks Rank #3 at present. The company is slated to report quarterly numbers on Apr 27.
The Earnings ESP for Prosperity Bancshares, Inc. (PB - Free Report) is +2.56% and it carries a Zacks Rank #3, currently. The company is scheduled to report quarterly numbers on Apr 28.
Carlyle Group (CG - Free Report) is slated to report quarterly results on Apr 29. The company currently has an Earnings ESP of +1.46% and a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Zacks' Top Picks to Cash in on Artificial Intelligence
In 2021, this world-changing technology is projected to generate $327.5 billion in revenue. Now Shark Tank star and billionaire investor Mark Cuban says AI will create ""the world's first trillionaires."" Zacks' urgent special report reveals 3 AI picks investors need to know about today.
See 3 Artificial Intelligence Stocks With Extreme Upside Potential>>