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Carlyle (CG) Stock Down Despite Q4 Earnings & Revenue Beat
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TheCarlyle Group Inc. (CG - Free Report) reported fourth-quarter 2021 post-tax distributable earnings of $2.01 per share, which comfortably surpassed the Zacks Consensus Estimate of $1.25. Also, the bottom line increased substantially from 64 cents in the year-ago quarter.
While a rise in revenues on higher fees and assets under management (AUM) growth supported the results, increased expenses created a major headwind. This likely led to a 7.7% decline in shares.
Net income available to common stockholders (GAAP basis) was $647.6 million or $1.77 per share compared with $518.8 million or $1.44 in the prior-year quarter.
In 2021, post-tax distributable earnings of $5.01 per share beat the consensus estimate of $4.19 and increased substantially from $2.05 in 2020. Also, net income of $2.97 billion was substantially up from $348.2 million in 2020.
Revenues & Expenses Increase
Segment revenues were $1.89 billion, significantly increasing from $629.7 million in the year-ago quarter. The rise primarily resulted from higher fees and realized performance revenues. Also, the top line outpaced the Zacks Consensus Estimate of $1.18 billion.
Segment revenues increased substantially from $2.29 billion in 2020 to $4.95 billion in 2021. The top line surpassed the consensus estimate of $4.23 billion.
Fee revenues in the fourth quarter increased 20.6% year over year to $517.4 million. A rise in fund management fees, and transaction and portfolio advisory fees supported the increase. Realized performance revenues significantly increased from $175.5 million in the prior-year quarter to $1.31 billion.
Total segment expenses amounted to $992 million, flaring up from $392.8 million in the prior-year quarter. The increase was primarily due to a rise in total compensation and benefits expenses, as well as general, administrative and other expenses.
AUM Climbs
As of Dec 31, 2021, total assets under management (AUM) were $301 billion, up 3% from the prior quarter. This was primarily attributed to an increase in fundraising across all three segments, particularly Global Credit, as well as market appreciation, partially offset by a record level of realization activity.
Fee-earning AUM for the reported quarter totaled $193 billion, up 9.7% from the prior quarter.
Dividend Update
Carlyle’s board of directors announced a quarterly cash dividend of 25 cents per share. The dividend will be paid out on Feb 23 to shareholders of record as of Feb 15, 2021.
The company’s board of directors approved a dividend hike to $1.30 per share on an annual basis or 32.5 cents quarterly. The raised dividend is anticipated to be paid in May for the first quarter of 2022.
Conclusion
Carlyle put up a good show in the fourth quarter in terms of earnings and revenues. Its efforts to expand operations by entering business avenues are encouraging. Also, an increase in AUM balance and fund management fees is likely to support its organic growth. However, a persistent rise in expenses is expected to deter bottom-line expansion.
Carlyle Group Inc. Price, Consensus and EPS Surprise
BlackRock, Inc.’s (BLK - Free Report) fourth-quarter 2021 adjusted earnings of $10.42 per share outpaced the Zacks Consensus Estimate of $10.23. The figure reflects a rise of 2.4% from the year-ago quarter. Net income attributable to BlackRock (on a GAAP basis) was $1.64 billion, up 6.1% from the prior-year quarter.
BLK’s results benefited from an improvement in revenues, partly offset by higher expenses. Moreover, long-term net inflows supported growth in AUM balance.
Invesco’s (IVZ - Free Report) fourth-quarter 2021 adjusted earnings of 86 cents per share handily outpaced the Zacks Consensus Estimate of 76 cents. The bottom line grew 19.4% from the prior-year quarter. On a GAAP basis, Invesco’s net income attributable to common shareholders was $426.8 million or 92 cents per share, up from $211.1 million or 46 cents per share a year ago.
IVZ’s results reflected an improvement in revenues and solid growth in AUM balance. However, a rise in operating expenses was a headwind.
Ameriprise Financial’s (AMP - Free Report) fourth-quarter 2021 adjusted operating earnings per share of $6.15 surpassed the Zacks Consensus Estimate of $5.77. The bottom line reflects a rise of 35.8% from the year-ago quarter. Ameriprise’s net income (GAAP basis) was $701 million or $5.96 per share, up from $177 million or $1.43 per share in the prior-year quarter.
AMP’s results were aided by growth in revenues, partly offset by higher expenses. Improvements in AUM and assets under administration balance were tailwinds.
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Carlyle (CG) Stock Down Despite Q4 Earnings & Revenue Beat
The Carlyle Group Inc. (CG - Free Report) reported fourth-quarter 2021 post-tax distributable earnings of $2.01 per share, which comfortably surpassed the Zacks Consensus Estimate of $1.25. Also, the bottom line increased substantially from 64 cents in the year-ago quarter.
While a rise in revenues on higher fees and assets under management (AUM) growth supported the results, increased expenses created a major headwind. This likely led to a 7.7% decline in shares.
Net income available to common stockholders (GAAP basis) was $647.6 million or $1.77 per share compared with $518.8 million or $1.44 in the prior-year quarter.
In 2021, post-tax distributable earnings of $5.01 per share beat the consensus estimate of $4.19 and increased substantially from $2.05 in 2020. Also, net income of $2.97 billion was substantially up from $348.2 million in 2020.
Revenues & Expenses Increase
Segment revenues were $1.89 billion, significantly increasing from $629.7 million in the year-ago quarter. The rise primarily resulted from higher fees and realized performance revenues. Also, the top line outpaced the Zacks Consensus Estimate of $1.18 billion.
Segment revenues increased substantially from $2.29 billion in 2020 to $4.95 billion in 2021. The top line surpassed the consensus estimate of $4.23 billion.
Fee revenues in the fourth quarter increased 20.6% year over year to $517.4 million. A rise in fund management fees, and transaction and portfolio advisory fees supported the increase. Realized performance revenues significantly increased from $175.5 million in the prior-year quarter to $1.31 billion.
Total segment expenses amounted to $992 million, flaring up from $392.8 million in the prior-year quarter. The increase was primarily due to a rise in total compensation and benefits expenses, as well as general, administrative and other expenses.
AUM Climbs
As of Dec 31, 2021, total assets under management (AUM) were $301 billion, up 3% from the prior quarter. This was primarily attributed to an increase in fundraising across all three segments, particularly Global Credit, as well as market appreciation, partially offset by a record level of realization activity.
Fee-earning AUM for the reported quarter totaled $193 billion, up 9.7% from the prior quarter.
Dividend Update
Carlyle’s board of directors announced a quarterly cash dividend of 25 cents per share. The dividend will be paid out on Feb 23 to shareholders of record as of Feb 15, 2021.
The company’s board of directors approved a dividend hike to $1.30 per share on an annual basis or 32.5 cents quarterly. The raised dividend is anticipated to be paid in May for the first quarter of 2022.
Conclusion
Carlyle put up a good show in the fourth quarter in terms of earnings and revenues. Its efforts to expand operations by entering business avenues are encouraging. Also, an increase in AUM balance and fund management fees is likely to support its organic growth. However, a persistent rise in expenses is expected to deter bottom-line expansion.
Carlyle Group Inc. Price, Consensus and EPS Surprise
Carlyle Group Inc. price-consensus-eps-surprise-chart | Carlyle Group Inc. Quote
Currently, Carlyle 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 Finance Stocks
BlackRock, Inc.’s (BLK - Free Report) fourth-quarter 2021 adjusted earnings of $10.42 per share outpaced the Zacks Consensus Estimate of $10.23. The figure reflects a rise of 2.4% from the year-ago quarter. Net income attributable to BlackRock (on a GAAP basis) was $1.64 billion, up 6.1% from the prior-year quarter.
BLK’s results benefited from an improvement in revenues, partly offset by higher expenses. Moreover, long-term net inflows supported growth in AUM balance.
Invesco’s (IVZ - Free Report) fourth-quarter 2021 adjusted earnings of 86 cents per share handily outpaced the Zacks Consensus Estimate of 76 cents. The bottom line grew 19.4% from the prior-year quarter. On a GAAP basis, Invesco’s net income attributable to common shareholders was $426.8 million or 92 cents per share, up from $211.1 million or 46 cents per share a year ago.
IVZ’s results reflected an improvement in revenues and solid growth in AUM balance. However, a rise in operating expenses was a headwind.
Ameriprise Financial’s (AMP - Free Report) fourth-quarter 2021 adjusted operating earnings per share of $6.15 surpassed the Zacks Consensus Estimate of $5.77. The bottom line reflects a rise of 35.8% from the year-ago quarter. Ameriprise’s net income (GAAP basis) was $701 million or $5.96 per share, up from $177 million or $1.43 per share in the prior-year quarter.
AMP’s results were aided by growth in revenues, partly offset by higher expenses. Improvements in AUM and assets under administration balance were tailwinds.