Back to top

Image: Bigstock

Affiliated Managers (AMG) Q1 Earnings Top, Revenues & AUM Down

Read MoreHide Full Article

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 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.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


BlackRock, Inc. (BLK) - free report >>

Invesco Ltd. (IVZ) - free report >>

Affiliated Managers Group, Inc. (AMG) - free report >>

Published in