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What's in Store for Affiliated Managers (AMG) in Q2 Earnings?

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Affiliated Managers Group Inc. (AMG - Free Report) is slated to report second-quarter 2021 results on Jul 28, before the opening bell. Its earnings and revenues in the quarter are expected to have increased on a year-over-year basis.

In the last reported quarter, the company’s earnings surpassed the Zacks Consensus Estimate. Results benefited from an improvement in revenues and growth in assets under management (AUM) balance. However, higher operating expenses posed a headwind.

The company boasts an impressive earnings surprise history. Its earnings surpassed the consensus estimate in each of the trailing four quarters, the average beat being 7.4%.

Affiliated Managers Group, Inc. Price and EPS Surprise

 

Affiliated Managers Group, Inc. Price and EPS Surprise

Affiliated Managers Group, Inc. price-eps-surprise | Affiliated Managers Group, Inc. Quote

Earnings & Sales Projections for Q2

Activities of the company in the second quarter encouraged analysts to revise earnings estimates upward. Thus, the Zacks Consensus Estimate for earnings of $3.82 for the to-be-reported quarter has increased 3.2% over the past 30 days. Also, the estimate indicates a rise of 39.4% from the year-ago quarter’s reported figure.

The consensus estimate for sales is pegged at $590.7 million, indicating a rise of 25.4% from the year-ago quarter’s reported number.

Other Key Expectations for Q2

Management expects adjusted earnings before interest, tax, depreciation and amortization of $210-$220 million.

Other economic items (excluding any mark-to-market impact) are anticipated to be $1 million.

Interest expenses are expected to be $27 million, suggesting a relatively stable figure compared with the prior quarter’s reported level. Controlling interest depreciation is expected to remain at the first-quarter 2021 level of $2 million.

The company’s share of reported amortization and impairments are expected to be $35 million, indicating a 15% sequential decline.

Performance fee is anticipated to be $10 million and includes investments in OCP Asia Limited and Boston Common Asset Management.

On Feb 8, 2021, Affiliated Managers acquired a minority equity interest in Boston Common, with an aim to further enhance participation in environmental, social, and governance investing. On Apr 30, it acquired a minority interest in OCP Asia, which is a credit provider in private markets across the Asia Pacific region, with focus on customized secured lending solutions. This acquisition was made with an aim to further enhance participation in private markets and exposure to growth markets across Asia.

Earnings Whispers

Now, let’s check what our quantitative model predicts.

According to our quantitative model, it cannot be conclusively predicted whether Affiliated Managers will be able to beat the Zacks Consensus Estimate this time. This is because it does not have the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or higher.

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 Affiliated Managers is 0.00%.

Zacks Rank: The company currently carries a Zacks Rank #2 (Buy). While this increases the predictive power of ESP, we also need a positive ESP to be confident of an earnings beat.

Stocks to Consider

Here are a few 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 Prosperity Bancshares (PB - Free Report) is +1.52% and it carries a Zacks Rank #2 at present. The company is slated to report quarterly numbers on Jul 28.

Evercore Inc. (EVR - Free Report) is also scheduled to release earnings on Jul 28. The company currently carries a Zacks Rank #2 and has an Earnings ESP of +4.84%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

T. Rowe Price Group (TROW - Free Report) is scheduled to release earnings on Jul 29. The company, which carries a Zacks Rank #3 at present, has an Earnings ESP of +1.34%.