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Is an Earnings Beat in Store for T. Rowe Price (TROW) in Q4?
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T. Rowe Price Group (TROW - Free Report) is scheduled to report fourth quarter and 2017 results on Jan 30. The company is expected to witness year-over-year growth in revenues and earnings.
Why a Likely Positive Surprise?
Our proven model shows that T. Rowe Price is expected to beat on earnings in the fourth quarter. This is because the company has the right combination of two key ingredients for a possible earnings beat — a positive Earnings ESP and a Zacks Rank #3 (Hold) or better.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks ESP: The Earnings ESP for T. Rowe Price is +0.90%.
Zacks Rank: The stock carries a Zacks Rank #2 (Buy).
Also, activities of the company during the quarter were adequate to win analysts’ confidence. As a result, the Zacks Consensus Estimate for earnings of $1.45 for the to-be-reported quarter has been revised 1.4% upward over the last 30 days. The figure reflects year-over-year improvement of 19.8%.
Notably, the company’s performance over the past year was decent. It surpassed the Zacks Consensus Estimate in two of the trailing four quarters with an average beat of 1.5%.
Mutual Fund Products Performance: The company is likely to record a rise in assets under management (AUM), as the equity markets’ performance was decent in the fourth quarter. The S&P 500 index gained nearly 5.7% in the quarter, which is likely to benefit T. Rowe Price, given its equity-heavy asset mix. Notably, the Zacks Consensus Estimate for AUM is $961 billion, up 3.7% sequentially.
Revenues Might Grow: T. Rowe Price’s revenues are expected to benefit from strong advisory market during the quarter. Also, higher AUM will benefit the company’s top line. Notably, the Zacks Consensus Estimate for sales is $1.27 billion, up 16.1% year over year.
Expenses to Escalate: Due to its several planned strategic actions, T. Rowe Price expects operating expenses for 2017 to rise at a rate of 11% on account of higher variable compensation expenses. Notably, the company is anticipating capital expenditures in 2017 to be approximately $200 million, including two-third for technology development.
Other Stocks That Warrant a Look
Here are a few other finance stocks you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this time around.
Lazard Ltd. (LAZ - Free Report) has an Earnings ESP of +2.17% and a Zacks Rank of 3. It is slated to release results on Feb 1.
Eaton Vance Corp. (EV - Free Report) has an Earnings ESP of +0.64% and a Zacks Rank #1. The company is expected to release its results on Feb 28.
Zacks Top 10 Stocks for 2018
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2018?
Last year's 2017 Zacks Top 10 Stocks portfolio produced double-digit winners, including FMC Corp. and VMware which racked up stellar gains of +67.9% and +61%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
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Is an Earnings Beat in Store for T. Rowe Price (TROW) in Q4?
T. Rowe Price Group (TROW - Free Report) is scheduled to report fourth quarter and 2017 results on Jan 30. The company is expected to witness year-over-year growth in revenues and earnings.
Why a Likely Positive Surprise?
Our proven model shows that T. Rowe Price is expected to beat on earnings in the fourth quarter. This is because the company has the right combination of two key ingredients for a possible earnings beat — a positive Earnings ESP and a Zacks Rank #3 (Hold) or better.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks ESP: The Earnings ESP for T. Rowe Price is +0.90%.
Zacks Rank: The stock carries a Zacks Rank #2 (Buy).
Also, activities of the company during the quarter were adequate to win analysts’ confidence. As a result, the Zacks Consensus Estimate for earnings of $1.45 for the to-be-reported quarter has been revised 1.4% upward over the last 30 days. The figure reflects year-over-year improvement of 19.8%.
Notably, the company’s performance over the past year was decent. It surpassed the Zacks Consensus Estimate in two of the trailing four quarters with an average beat of 1.5%.
T. Rowe Price Group, Inc. Price and EPS Surprise
T. Rowe Price Group, Inc. Price and EPS Surprise | T. Rowe Price Group, Inc. Quote
Factors to Influence Q4 Results
Mutual Fund Products Performance: The company is likely to record a rise in assets under management (AUM), as the equity markets’ performance was decent in the fourth quarter. The S&P 500 index gained nearly 5.7% in the quarter, which is likely to benefit T. Rowe Price, given its equity-heavy asset mix. Notably, the Zacks Consensus Estimate for AUM is $961 billion, up 3.7% sequentially.
Revenues Might Grow: T. Rowe Price’s revenues are expected to benefit from strong advisory market during the quarter. Also, higher AUM will benefit the company’s top line. Notably, the Zacks Consensus Estimate for sales is $1.27 billion, up 16.1% year over year.
Expenses to Escalate: Due to its several planned strategic actions, T. Rowe Price expects operating expenses for 2017 to rise at a rate of 11% on account of higher variable compensation expenses. Notably, the company is anticipating capital expenditures in 2017 to be approximately $200 million, including two-third for technology development.
Other Stocks That Warrant a Look
Here are a few other finance stocks you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this time around.
Apollo Global Management (APO - Free Report) is slated to report results on Feb 1. It has an Earnings ESP of +3.61% and carries a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Lazard Ltd. (LAZ - Free Report) has an Earnings ESP of +2.17% and a Zacks Rank of 3. It is slated to release results on Feb 1.
Eaton Vance Corp. (EV - Free Report) has an Earnings ESP of +0.64% and a Zacks Rank #1. The company is expected to release its results on Feb 28.
Zacks Top 10 Stocks for 2018
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2018?
Last year's 2017 Zacks Top 10 Stocks portfolio produced double-digit winners, including FMC Corp. and VMware which racked up stellar gains of +67.9% and +61%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Access Zacks Top 10 Stocks for 2018 today >>