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Affiliated Managers (AMG) Q1 Earnings Top, Revenues & AUM Down
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Affiliated Managers Group Inc.’s (AMG - Free Report) first-quarter 2023 economic earnings of $4.18 per share surpassed the Zacks Consensus Estimate of 4.15. The bottom line, however, declined 4.1% from the prior-year number. Our estimate for economic earnings per share was $4.16.
Results were aided by lower expenses, partially offset by a decline in revenues and assets under management (AUM) balance. Further, the company had a robust liquidity position.
Economic net income was $158.1 million, down 11.4% from the prior-year quarter. Our estimate for this metric was the same as the reported number.
Revenues & Expenses Decline, AUM Falls
Total revenues declined 14.8% year over year to $517.4 million. Also, the top line lagged the Zacks Consensus Estimate of $546.8 million. Our estimate for total revenues was $537 million.
Adjusted EBITDA was $216.8 million, down 9.7% from the year-ago quarter.
Total expenses decreased 3.7% to $380.5 million. Lower compensation and related expenses largely led to the fall. Our estimate for total expenses was $401 million.
As of Mar 31, 2023, total AUM was $668 billion, which declined 14%. Net client cash outflows in the quarter were $3.2 billion. Our estimate for AUM was $651.4 billion.
Capital & Liquidity Position Decent
As of Mar 31, 2023, Affiliated Managers had $832.8 million in cash and cash equivalents compared with $429.2 billion as of Dec 31, 2022. The company had $2.54 billion of debt, relatively stable from the prior quarter.
Shareholders’ equity as of Mar 31, 2023, was $3.27 billion compared with $3.23 billion as of Dec 31, 2022.
Share Repurchase Update
During the first quarter, Affiliated Managers continued to execute its seven-month $225 million accelerated share repurchase (ASR) program. The company entered into the ASR program at the end of 2022.
Our View
Affiliated Managers remains well-positioned for growth on the back of successful partnerships, global distribution capability and a diverse product mix. However, substantial intangible assets on the company's balance sheet and the tough operating backdrop are major concerns.
Affiliated Managers Group, Inc. Price, Consensus and EPS Surprise
BlackRock, Inc.’s (BLK - Free Report) first-quarter 2023 adjusted earnings of $7.93 per share surpassed the Zacks Consensus Estimate of $7.71. However, the figure reflects a decrease of 16.7% from the year-ago quarter. Our estimate for adjusted earnings was $7.37.
BLK's results have benefited from a decline in expenses. However, lower revenues and AUM balance were major headwinds.
Invesco’s (IVZ - Free Report) first-quarter 2023 adjusted earnings of 38 cents per share surpassed the Zacks Consensus Estimate of 36 cents. The bottom line, however, plunged 32.1% from the prior-year quarter. Our estimate for earnings was 31 cents.
Results benefited from a decline in operating expenses. On the other hand, lower assets under management (AUM) balance and long-term outflows hurt IVZ’s revenues.
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Affiliated Managers (AMG) Q1 Earnings Top, Revenues & AUM Down
Affiliated Managers Group Inc.’s (AMG - Free Report) first-quarter 2023 economic earnings of $4.18 per share surpassed the Zacks Consensus Estimate of 4.15. The bottom line, however, declined 4.1% from the prior-year number. Our estimate for economic earnings per share was $4.16.
Results were aided by lower expenses, partially offset by a decline in revenues and assets under management (AUM) balance. Further, the company had a robust liquidity position.
Economic net income was $158.1 million, down 11.4% from the prior-year quarter. Our estimate for this metric was the same as the reported number.
Revenues & Expenses Decline, AUM Falls
Total revenues declined 14.8% year over year to $517.4 million. Also, the top line lagged the Zacks Consensus Estimate of $546.8 million. Our estimate for total revenues was $537 million.
Adjusted EBITDA was $216.8 million, down 9.7% from the year-ago quarter.
Total expenses decreased 3.7% to $380.5 million. Lower compensation and related expenses largely led to the fall. Our estimate for total expenses was $401 million.
As of Mar 31, 2023, total AUM was $668 billion, which declined 14%. Net client cash outflows in the quarter were $3.2 billion. Our estimate for AUM was $651.4 billion.
Capital & Liquidity Position Decent
As of Mar 31, 2023, Affiliated Managers had $832.8 million in cash and cash equivalents compared with $429.2 billion as of Dec 31, 2022. The company had $2.54 billion of debt, relatively stable from the prior quarter.
Shareholders’ equity as of Mar 31, 2023, was $3.27 billion compared with $3.23 billion as of Dec 31, 2022.
Share Repurchase Update
During the first quarter, Affiliated Managers continued to execute its seven-month $225 million accelerated share repurchase (ASR) program. The company entered into the ASR program at the end of 2022.
Our View
Affiliated Managers remains well-positioned for growth on the back of successful partnerships, global distribution capability and a diverse product mix. However, substantial intangible assets on the company's balance sheet and the tough operating backdrop are major concerns.
Affiliated Managers Group, Inc. Price, Consensus and EPS Surprise
Affiliated Managers Group, Inc. price-consensus-eps-surprise-chart | Affiliated Managers Group, Inc. Quote
Affiliated Managers currently 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 Asset Managers
BlackRock, Inc.’s (BLK - Free Report) first-quarter 2023 adjusted earnings of $7.93 per share surpassed the Zacks Consensus Estimate of $7.71. However, the figure reflects a decrease of 16.7% from the year-ago quarter. Our estimate for adjusted earnings was $7.37.
BLK's results have benefited from a decline in expenses. However, lower revenues and AUM balance were major headwinds.
Invesco’s (IVZ - Free Report) first-quarter 2023 adjusted earnings of 38 cents per share surpassed the Zacks Consensus Estimate of 36 cents. The bottom line, however, plunged 32.1% from the prior-year quarter. Our estimate for earnings was 31 cents.
Results benefited from a decline in operating expenses. On the other hand, lower assets under management (AUM) balance and long-term outflows hurt IVZ’s revenues.