Victory Capital Holdings (VCTR - Free Report) is scheduled to report third-quarter 2018 results on Nov 6, after market close. Its earnings and revenues for full-year 2018 are expected to grow year over year.
In the last reported quarter, the company benefited from an improvement in revenues. Further, growth in assets under management (AUM) and lower expenses were on the positive side. However, net outflows during the quarter acted as a headwind.
However, activities of the company in the third quarter failed to encourage analysts to revise estimates upward. As a result, the Zacks Consensus Estimate for earnings of 43 cents remained stable over the past 30 days.
Victory Capital’s price performance does not seem very impressive. Its shares have lost 21.6% in the past three months compared with 12.7% decline recorded by the industry.
Will the price performance improve post third-quarter earnings? Before having a look at what our quantitative model predicts, let’s check the factors that are likely to impact the quarter’s results.
Factors to Influence Q3 Results
Per the monthly metrics data published by Victory Capital, its September-end AUM of $63.4 billion was up from $62.3 billion as of Jun 30, 2018. The increase is likely driven by strong inflows in U.S. Small Cap Equity.
Given the increase in AUM in the quarter, the related fee is also expected to witness some improvement, driving overall revenues higher.
Expenses are likely to have declined during the quarter on the back of Victory Capital’s operational efficiency, as reflected in the prior quarters.
According to our quantitative model, chances of Victory Capital beating the Zacks Consensus Estimate in the third quarter 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 — for increasing 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: The Earnings ESP for Victory Capital is 0.00%
Zacks Rank: Victory Capital currently has a Zacks Rank #3
Victory Capital Holdings, Inc. Price and EPS Surprise
Performance of Other Investment Managers
Waddell & Reed Financial Inc.’s (WDR - Free Report) third-quarter 2018 earnings of 58 cents per share outpaced the Zacks Consensus Estimate of 57 cents. Moreover, the figure compared favorably with the year-ago quarter’s earnings of 64 cents.
Lazard Inc. (LAZ - Free Report) reported adjusted earnings of 86 cents per share, lagging the Zacks Consensus Estimate of 89 cents. However, the reported figure came in a penny higher than the prior-year quarter.
Federated Investors, Inc. (FII - Free Report) reported a positive earnings surprise of 9.3% in third-quarter 2018. Earnings per share of 59 cents surpassed the Zacks Consensus Estimate of 54 cents. Moreover, the figure compares favorably with the prior-year quarter earnings of 56 cents.
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