Ameriprise (AMP) Q3 Earnings Beat, Revenues & Costs Rise Y/Y
Ameriprise Financial’s AMP third-quarter 2023 adjusted operating earnings (excluding unlocking) of $7.68 per share handily surpassed the Zacks Consensus Estimate of $7.58. The bottom line reflects a rise of 21% from the year-ago quarter.
Results were aided by revenue growth, along with higher assets under management (AUM) and assets under administration (AUA) balances. However, an increase in expenses was a negative.
After considering significant items, net income (GAAP basis) was $872 million or $8.14 per share, down from $1.06 billion or $9.41 per share in the prior-year quarter. Our estimate for the metric was $803.8 million.
Revenues Improve, Expenses Rise
On an operating basis, adjusted total net revenues were $3.91 billion, up 10% year over year. The top line missed the Zacks Consensus Estimate of $3.96 billion.
On a GAAP basis, net revenues were $3.93 billion, growing 13% year over year.
Adjusted operating expenses totaled $2.96 billion, which increased 18% year over year. We had projected the same to be $3.09 billion.
Total AUM and AUA increased 12% year over year to $1.23 trillion. The rise reflected strong client net inflows and market appreciation. Our estimate for the metric was $1.28 trillion.
Share Repurchase Update
In the reported quarter, Ameriprise repurchased 1.5 million shares for $520 million.
Our Take
Elevated expenses (mainly due to technology upgrades) will likely continue to hurt AMP’s bottom line. However, Ameriprise is well-positioned for impressive top-line growth on the back of its robust AUM balance and business-restructuring initiatives.
Ameriprise Financial, Inc. Price, Consensus and EPS Surprise
Ameriprise Financial, Inc. price-consensus-eps-surprise-chart | Ameriprise Financial, Inc. Quote
Ameriprise 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 third-quarter 2023 adjusted earnings of $10.91 per share handily surpassed the Zacks Consensus Estimate of $8.52. Also, the figure reflects an increase of 14.2% from the year-ago quarter.
BLK’s results benefited from a rise in revenues and higher non-operating income. Further, the AUM balance witnessed improvement. However, higher expenses acted as a headwind for BLK.
Invesco’s IVZ third-quarter 2023 adjusted earnings of 35 cents per share lagged the Zacks Consensus Estimate of 36 cents. The bottom line, however, rose 2.9% from the prior-year quarter.
IVZ’s results were hurt by a rise in operating expenses and lower revenues. Nevertheless, an increase in the AUM balance on decent inflows aided the results to some extent.
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