Investment Management Earnings Preview: APO, FIG, OMAM
Zacks Investment Research | May 04, 2016 06:56AM ET
Investment management (part of the broader Finance sector) performed decently over the last several quarters. But the trend is showing a gradual reversal. Slowdown in China’s economy, a stressed energy sector, uncertainty over the timing of the Fed rate hike and several other macroeconomic factors weighed on investors’ mind. This led to huge sell offs in the equity markets across the globe in January and February. Though the markets rebounded in March, this was not enough to mitigate the downtrend witnessed during the earlier two months.
As a fall out of these matters, the investors turned risk averse, leading to significant outflows across the industry. Also, assets under management for many investment managers did not witness any improvement in the three months ended Mar 31, 2016.
Further, being globally diversified, performance of investment managers was adversely impacted by the strengthening U.S. dollar. Therefore, revenues suffered significantly.
Several investment managers have already reported their results and the picture don’t look good. Investment management stocks including BlackRock, Inc. (NYSE:BLK) , Invesco Ltd. (NYSE:IVZ) , Franklin Resources, Inc. (NYSE:BEN) , Janus Capital Group, Inc. (NYSE:JNS) and The Blackstone Group L.P. (NYSE:BX) lagged estimates. Also, fundamentals show weakness owing to increased market volatility.
Despite this overall bearish stance, there might be a surprise in store. So, let’s have a look at the three investment management stocks that are scheduled to report their earnings tomorrow.
Apollo Global Management, LLC (NYSE:APO) is slated to report before the opening bell. The Zacks Consensus Estimate for the company has been witnessing a downward revision over the last 30 days. Additionally, the estimate of 9 cents per share for the upcoming release indicates a year-over-year decline of about 60.87%.
Further, the company has a Zacks Rank #3 (Hold) with an Zacks Investment Research
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