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Invesco's (IVZ) Q3 Earnings Miss Estimates, AUM Balance Up
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Invesco’s (IVZ - Free Report) third-quarter 2023 adjusted earnings of 35 cents per share lagged the Zacks Consensus Estimate of 36 cents. The bottom line, however, rose 2.9% from the prior-year quarter.
Results were hurt by a rise in operating expenses and lower revenues. Nevertheless, an increase in assets under management (AUM) balance on decent inflows aided the results to some extent.
On a GAAP basis, net income attributable to common shareholders was $131.4 million or 29 cents per share, down from $177.4 million or 39 cents per share a year ago. Our estimate for net income was $153.8 million.
Revenues Decline, Expenses Rise
Adjusted quarterly net revenues were $1.1 billion, falling 1.1% year over year. The top line marginally beat the Zacks Consensus Estimate of $1.09 billion.
Adjusted operating expenses were $789 million, up 6.4% year over year. We expected the metric to be $777.8 million.
The adjusted operating margin was 28.2%, down from 33.3% a year ago.
AUM Balance Increases
As of Sep 30, 2023, AUM was $1.49 trillion, which increased 12.4% year over year. Average AUM at the third-quarter end totaled $1.53 trillion, up 7.9%. Our estimates for total AUM and average AUM were $1.56 trillion and $1.55 trillion, respectively.
The company witnessed long-term net inflows of $2.6 billion in the quarter.
Balance Sheet Strong
As of Sep 30, 2023, cash and cash equivalents were $1.24 billion compared with $1.01 billion as of Jun 30, 2023.
Long-term debt was $1.49 billion. The credit facility balance was nil as of Sep 30, 2023.
Share Repurchase Update
During the reported quarter, Invesco repurchased shares worth $90 million.
Our View
Invesco is well-poised to benefit from its global footprint, product offerings and strategic buyouts. However, elevated expenses, a challenging market environment and high debt levels are major near-term concerns.
Performance & Earnings Release Date of Other Asset Managers
BlackRock, Inc.’s (BLK - Free Report) third-quarter 2023 adjusted earnings of $10.91 per share handily surpassed the Zacks Consensus Estimate of $8.52. Also, the figure reflects an increase of 14.2% from the year-ago quarter.
Results have benefited from a rise in revenues and higher non-operating income. Further, the AUM balance witnessed improvement. However, higher expenses acted as a headwind for BLK.
Ameriprise Financial (AMP - Free Report) is slated to report third-quarter 2023 results on Oct 25.
Over the past 30 days, the Zacks Consensus Estimate for AMP’s quarterly earnings has moved almost 1% lower to $7.58. The figure indicates a 17.9% rise from the prior-year quarter.
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Invesco's (IVZ) Q3 Earnings Miss Estimates, AUM Balance Up
Invesco’s (IVZ - Free Report) third-quarter 2023 adjusted earnings of 35 cents per share lagged the Zacks Consensus Estimate of 36 cents. The bottom line, however, rose 2.9% from the prior-year quarter.
Results were hurt by a rise in operating expenses and lower revenues. Nevertheless, an increase in assets under management (AUM) balance on decent inflows aided the results to some extent.
On a GAAP basis, net income attributable to common shareholders was $131.4 million or 29 cents per share, down from $177.4 million or 39 cents per share a year ago. Our estimate for net income was $153.8 million.
Revenues Decline, Expenses Rise
Adjusted quarterly net revenues were $1.1 billion, falling 1.1% year over year. The top line marginally beat the Zacks Consensus Estimate of $1.09 billion.
Adjusted operating expenses were $789 million, up 6.4% year over year. We expected the metric to be $777.8 million.
The adjusted operating margin was 28.2%, down from 33.3% a year ago.
AUM Balance Increases
As of Sep 30, 2023, AUM was $1.49 trillion, which increased 12.4% year over year. Average AUM at the third-quarter end totaled $1.53 trillion, up 7.9%. Our estimates for total AUM and average AUM were $1.56 trillion and $1.55 trillion, respectively.
The company witnessed long-term net inflows of $2.6 billion in the quarter.
Balance Sheet Strong
As of Sep 30, 2023, cash and cash equivalents were $1.24 billion compared with $1.01 billion as of Jun 30, 2023.
Long-term debt was $1.49 billion. The credit facility balance was nil as of Sep 30, 2023.
Share Repurchase Update
During the reported quarter, Invesco repurchased shares worth $90 million.
Our View
Invesco is well-poised to benefit from its global footprint, product offerings and strategic buyouts. However, elevated expenses, a challenging market environment and high debt levels are major near-term concerns.
Invesco Ltd. Price, Consensus and EPS Surprise
Invesco Ltd. price-consensus-eps-surprise-chart | Invesco Ltd. Quote
Currently, IVZ carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance & Earnings Release Date of Other Asset Managers
BlackRock, Inc.’s (BLK - Free Report) third-quarter 2023 adjusted earnings of $10.91 per share handily surpassed the Zacks Consensus Estimate of $8.52. Also, the figure reflects an increase of 14.2% from the year-ago quarter.
Results have benefited from a rise in revenues and higher non-operating income. Further, the AUM balance witnessed improvement. However, higher expenses acted as a headwind for BLK.
Ameriprise Financial (AMP - Free Report) is slated to report third-quarter 2023 results on Oct 25.
Over the past 30 days, the Zacks Consensus Estimate for AMP’s quarterly earnings has moved almost 1% lower to $7.58. The figure indicates a 17.9% rise from the prior-year quarter.