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Robust Growth in AUM to Support Invesco This Earnings Season

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Invesco (IVZ - Free Report) is slated to report third-quarter 2024 results on Oct. 22, before market open. The company’s earnings and revenues are expected to have witnessed a rise on a year-over-year basis.

Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.

In the last reported quarter, IVZ’s adjusted earnings beat the Zacks Consensus Estimate. Results primarily benefited from an increase in assets under management balance (AUM) balance and lower adjusted expenses. However, marginally lower adjusted revenues hurt results to some extent.

Invesco does not have an impressive earnings surprise history. Its earnings surpassed the Zacks Consensus Estimate in two and lagged in two of the trailing four quarters, with the average surprise being 1.93%.

Invesco Ltd. Price and EPS Surprise

Invesco Ltd. Price and EPS Surprise

Invesco Ltd. price-eps-surprise | Invesco Ltd. Quote

Invesco’s Q3 Earnings and Sales Estimates

The Zacks Consensus Estimate for Invesco’s earnings of 44 cents has been revised 2.3% north over the past seven days. The figure indicates a rise of 25.7% from the year-ago quarter.

The consensus estimate for sales is pegged at $1.11 billion, suggesting almost a 1% rise.

Invesco’s Key Q3 Estimates & Factors to Note

Per the monthly metrics data published by Invesco, its preliminary total AUM as of Sept. 30, 2024, was $1.8 trillion, up 4.7% from the June 30, 2024 level. Driven by the improvement in the AUM balance on the back of solid inflows and upbeat markets, the company’s investment management fee is expected to have risen. The Zacks Consensus Estimate for investment management fee is pegged at $1.08 billion, indicating an increase of 3.4% year over year. 

The consensus estimate for performance fees of $6.3 million indicates a significant jump from the prior-year quarter.

The consensus estimate for service and distribution fees of $372.8 million implies a 5.4% growth. The Zacks Consensus Estimate for other revenues is pegged at $50 million, suggesting a 10.6% rise. 

On the cost front, while Invesco’s cost-saving initiatives are likely to have boosted its efficiency, the steady rise in compensation and marketing costs is expected to have had an adverse impact on overall expenses in the to-be-reported quarter.

What Our Model Predicts for IVZ

According to our proven model, the chances of Invesco beating the Zacks Consensus Estimate for earnings this time are low. 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 better.

You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Earnings ESP: The Earnings ESP for Invesco is -0.55%

Zacks Rank: The company currently carries a Zacks Rank #2 (Buy).

Invesco’s Peers Worth a Look

Here are a couple of asset managers that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this time:

The Earnings ESP for SEI Investments (SEIC - Free Report) is +0.94% and it carries a Zacks Rank #2 at present. The company is slated to report third-quarter 2024 results on Oct. 23.

Over the past seven days, the Zacks Consensus Estimate for SEIC’s quarterly earnings has remained unchanged at $1.07

Ameriprise (AMP - Free Report) is also scheduled to release third-quarter 2024 earnings on Oct. 23. The company, which carries a Zacks Rank #2 at present, has an Earnings ESP of +0.68%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

AMP’s quarterly earnings estimates have remained unchanged at $8.87 over the past week.


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