Investment Managers' Q2 Earnings On Jul 27: IVZ, PFG & FII
Zacks Investment Research | Jul 25, 2017 09:46PM ET
Investment management (part of the broader Finance sector) performed decently over the last several quarters. This time too, decent results are expected on positive markets, favorable currencies and better-than-expected flows.
The S&P 500 Index recorded a total return of 3.1% in the second quarter. Though the U.S. equity market recorded positive returns amid mixed economic data, it underperformed both non-U.S. developed and emerging markets. Hence, asset managers with global presence are anticipated to record a rise in equity asset under management (AUM). Moreover, weakness of the U.S. dollar drove the global diversified AUM mix.
Further, rising interest rates are expected to lead to decline in fee waivers. Also, demand for alternative investment sources might have aided revenue growth for the investment managers. However, rise in operating expenses, driven by marketing and investments might hurt the bottom line.
Conversely, during the quarter, fixed income generated positive returns as investors ran for safe haven assets. Consequently, fixed income prices increased and resulted in reduced yields.
Notably, some investment managers, including The Blackstone Group L.P. (NYSE:BX) , T. Rowe Price Group, Inc. (NASDAQ:TROW) and BlackRock, Inc. (NYSE:BLK) , have already released their results. Out of these, Blackstone Group and BlackRock have missed estimates despite recording AUM growth, while T. Rowe Price beat estimates.
Notably, per our Original post
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