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Affiliated Managers (AMG) Q4 Earnings Beat as Revenues, AUM Rise

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Affiliated Managers Group Inc.’s (AMG - Free Report) fourth-quarter 2021 economic earnings of $6.10 per share handily surpassed the Zacks Consensus Estimate of $5.81. The bottom line jumped 44.5% year over year.

Results were aided by an improvement in revenues and growth in assets under management (AUM) balance, partly offset by higher expenses. Further, the company had a robust liquidity position.

Economic net income was $255.3 million, up 33.4% from the prior-year quarter.

In 2021, economic earnings per share of $18.28 beat the consensus estimate of $18.11 and grew 36.8% year over year. Economic net income was $779.8 million, up 24.9% from 2020.

Revenues & AUM Improve, Expenses Rise

Total revenues in the reported quarter soared 24.8% year over year to $691.8 million. Also, the top line beat the Zacks Consensus Estimate of $658.67 million.

In 2021, total revenues rose 19% to $2.41 billion. The top line also surpassed the consensus estimate of $2.38 billion.

Adjusted EBITDA was $356.8 million, jumping 39.8% from the year-ago quarter.

Total expenses increased 20.9% year over year to $467.7 million. An increase in all cost components, except for depreciation and other amortization costs, led to the rise.

As of Dec 31, 2021, total AUM was $813.8 billion, up 13.6% year over year. Net client cash outflows in the quarter were $6.2 billion.

Capital & Liquidity Position Decent

As of Dec 31, 2021, Affiliated Managers had $908.5 million in cash and cash equivalents compared with $1.04 billion as of Dec 31, 2020. The company had $2.49 billion of debt, which increased 7.7% from the Dec 31, 2020 level.

Shareholders’ equity as of Dec 31, 2021, was $2.79 billion compared with $2.78 billion as of Dec 31, 2020.

Share Repurchase Update

In the reported quarter, the company repurchased shares worth $120 million.

The company has increased the share buyback authorization to a total of 5.1 million shares.

Our View

Affiliated Managers remains well-positioned for growth on the back of successful partnerships and global distribution capability along with a diverse product mix. However, the presence of substantial intangible assets on the company's balance sheet remains a concern.
 

Affiliated Managers currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Asset Managers

BlackRock, Inc.’s (BLK - Free Report) fourth-quarter 2021 adjusted earnings of $10.42 per share outpaced the Zacks Consensus Estimate of $10.23. The figure reflects a rise of 2.4% from the year-ago quarter.

BLK’s results benefited from an improvement in revenues, partly offset by higher expenses. Moreover, long-term net inflows supported growth in AUM balance.

Invesco’s (IVZ - Free Report) fourth-quarter 2021 adjusted earnings of 86 cents per share handily outpaced the Zacks Consensus Estimate of 76 cents. The bottom line grew 19.4% from the prior-year quarter.

IVZ’s results reflected an improvement in revenues and solid growth in AUM balance. However, a rise in operating expenses was a headwind.

Ameriprise Financial’s (AMP - Free Report) fourth-quarter 2021 adjusted operating earnings per share of $6.15 surpassed the Zacks Consensus Estimate of $5.77. The bottom line reflects a rise of 35.8% from the year-ago quarter.

AMP’s results were aided by revenue growth, partly offset by higher expenses. Improvements in AUM and assets under administration balance were tailwinds.

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