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Is an Earnings Beat in Store for Ameriprise (AMP) in Q3?
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Ameriprise Financial, Inc. (AMP - Free Report) is scheduled to report third-quarter 2018 results on Oct 23, after the market closes. Its earnings and revenues are expected to grow year over year.
In the last reported quarter, the company’s earnings surpassed the Zacks Consensus Estimate. Results benefited from an improvement in revenues. Further, growth in assets under management (AUM) and assets under administration (AUA) was on the positive side. However, rise in expenses acted as a headwind.
The company has an impressive earnings surprise history. Its earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average beat being 9.5%.
Notably, activities of the company during the third quarter encouraged analysts to revise earnings estimates upward. Thus, the Zacks Consensus Estimate for earnings of $3.61 for the to-be-reported quarter increased marginally over the past 30 days. Moreover, the figure represents growth of 2.3% on a year-over-year basis.
The Zacks Consensus Estimate for sales is $3.19 billion, which reflects an improvement of 6.9% year over year.
However, the company’s price performance has not been very encouraging. Its shares have lost 19.8% so far this year compared with 19.2% decline recorded by the industry.
Will the price performance improve post Q3 earnings release? To a great extent, this depends on the company’s ability to maintain its trend of beating earnings estimates.
Before we take a look at what our quantitative model predicts, let’s check the factors that are likely to influence the quarter’s results.
Factors to Influence Q3 Results
Based on expectations of improved advisor productivity, the Advice & Wealth Management segment is likely to record growth in assets during the third quarter. Moreover, the Asset Management segment’s total AUM is expected to improve, driven by market appreciation, partly offset by net outflows.
Thus, supported by overall growth in AUM, the company’s management and financial advice fee is likely to improve. The Zacks Consensus Estimate for the same is $1.72 billion, reflecting growth of 1.4% sequentially.
The Zacks Consensus Estimate for distribution fees for the to-be-reported quarter is $476 million, which reflects rise of 2.4% sequentially.
The consensus estimate for other revenues shows that this component is also expected to improve during the third quarter. Its Zacks Consensus Estimate is pegged at $288 million, which represents rise of 1.4% sequentially.
However, the Zacks Consensus Estimate for net investment income for the third quarter is pegged at $337 million, which represents decline of 19.6% sequentially. Also, the consensus estimate for premiums is $354 million, representing a marginal decrease from the last reported quarter.
A Positive Surprise in Store?
According to our quantitative model, chances of Ameriprise beating the Zacks Consensus Estimate in the third quarter are high. This is because it has the right combination of the two key ingredients — a positive Earnings ESP and Zacks Rank #3 (Hold) or better — to increase the odds of an earnings beat.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: Ameriprise has an Earnings ESP of +4.30%.
Zacks Rank: Ameriprise currently carries a Zacks Rank #2 (Buy).
Other Stocks That Warrant a Look
Here are a few other stocks that you may want to consider, as according to our model, these too have the right combination of elements to post an earnings beat this quarter.
Regions Financial Corporation (RF - Free Report) has an Earnings ESP of +0.40% and a Zacks Rank of 3. The company is slated to release results on Oct 23.
T. Rowe Price Group, Inc. (TROW - Free Report) is also scheduled to release results on Oct 25. It has an Earnings ESP of +0.78% and a Zacks Rank #2.
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Image: Bigstock
Is an Earnings Beat in Store for Ameriprise (AMP) in Q3?
Ameriprise Financial, Inc. (AMP - Free Report) is scheduled to report third-quarter 2018 results on Oct 23, after the market closes. Its earnings and revenues are expected to grow year over year.
In the last reported quarter, the company’s earnings surpassed the Zacks Consensus Estimate. Results benefited from an improvement in revenues. Further, growth in assets under management (AUM) and assets under administration (AUA) was on the positive side. However, rise in expenses acted as a headwind.
The company has an impressive earnings surprise history. Its earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average beat being 9.5%.
Ameriprise Financial, Inc. Price and EPS Surprise
Ameriprise Financial, Inc. Price and EPS Surprise | Ameriprise Financial, Inc. Quote
Notably, activities of the company during the third quarter encouraged analysts to revise earnings estimates upward. Thus, the Zacks Consensus Estimate for earnings of $3.61 for the to-be-reported quarter increased marginally over the past 30 days. Moreover, the figure represents growth of 2.3% on a year-over-year basis.
The Zacks Consensus Estimate for sales is $3.19 billion, which reflects an improvement of 6.9% year over year.
However, the company’s price performance has not been very encouraging. Its shares have lost 19.8% so far this year compared with 19.2% decline recorded by the industry.
Will the price performance improve post Q3 earnings release? To a great extent, this depends on the company’s ability to maintain its trend of beating earnings estimates.
Before we take a look at what our quantitative model predicts, let’s check the factors that are likely to influence the quarter’s results.
Factors to Influence Q3 Results
Based on expectations of improved advisor productivity, the Advice & Wealth Management segment is likely to record growth in assets during the third quarter. Moreover, the Asset Management segment’s total AUM is expected to improve, driven by market appreciation, partly offset by net outflows.
Thus, supported by overall growth in AUM, the company’s management and financial advice fee is likely to improve. The Zacks Consensus Estimate for the same is $1.72 billion, reflecting growth of 1.4% sequentially.
The Zacks Consensus Estimate for distribution fees for the to-be-reported quarter is $476 million, which reflects rise of 2.4% sequentially.
The consensus estimate for other revenues shows that this component is also expected to improve during the third quarter. Its Zacks Consensus Estimate is pegged at $288 million, which represents rise of 1.4% sequentially.
However, the Zacks Consensus Estimate for net investment income for the third quarter is pegged at $337 million, which represents decline of 19.6% sequentially. Also, the consensus estimate for premiums is $354 million, representing a marginal decrease from the last reported quarter.
A Positive Surprise in Store?
According to our quantitative model, chances of Ameriprise beating the Zacks Consensus Estimate in the third quarter are high. This is because it has the right combination of the two key ingredients — a positive Earnings ESP and Zacks Rank #3 (Hold) or better — to increase the odds of an earnings beat.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: Ameriprise has an Earnings ESP of +4.30%.
Zacks Rank: Ameriprise currently carries a Zacks Rank #2 (Buy).
Other Stocks That Warrant a Look
Here are a few other stocks that you may want to consider, as according to our model, these too have the right combination of elements to post an earnings beat this quarter.
Regions Financial Corporation (RF - Free Report) has an Earnings ESP of +0.40% and a Zacks Rank of 3. The company is slated to release results on Oct 23.
SVB Financial Group is slated to release results on Oct 25. It has an Earnings ESP of +1.22% and a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
T. Rowe Price Group, Inc. (TROW - Free Report) is also scheduled to release results on Oct 25. It has an Earnings ESP of +0.78% and a Zacks Rank #2.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>