Artisan Partners (APAM) Up 10.6% Since Last Earnings Report: Can It Continue?
It has been about a month since the last earnings report for Artisan Partners Asset Management (APAM). Shares have added about 10.6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Artisan Partners due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Artisan Partners Q3 Earnings Beat Estimates, AUM Falls
Artisan Partners reported third-quarter 2023 adjusted net income per adjusted share of 75 cents, which surpassed the Zacks Consensus Estimate of 47 cents. The bottom line increased 7.1% year over year.
Results benefited from a rise in management fees earned from Artisan Funds & Artisan Global Funds, and Separate accounts, which resulted in top-line growth. Balance sheet position improved in the reported quarter. However, elevated operating expenses and a fall in AUM were the undermining factors.
Net income attributable to Artisan Partners (GAAP basis) was $53.1 million, up from $44.2 million in the prior-year quarter.
Revenues & Expenses Rise
Third-quarter revenues were $248.7 million, which rose 6.1% from a year ago. The top line outpaced the Zacks Consensus Estimate of $197.4 million.
Management fees earned from Artisan Funds & Artisan Global Funds increased 6.8% year over year to $156.4 million. Management fees earned from Separate accounts rose 5% to $92.2 million.
Total operating expenses totaled $166.5 million, up 7% year over year. An increase in all components of operating expenses resulted in this uptick.
Operating income was $82.2 million, up 4.4% year over year.
AUM Balance Falls
As of Sep 30, 2023, the ending AUM was $136.5 billion, down 4.5% from the previous quarter, mainly due to market depreciation and net client cash outflows.
Average AUM reached $142.2 billion, up 2.1% from the prior quarter.
Balance Sheet Position Improves
Cash and cash equivalents were $198.3 million compared with $114.8 million as of Dec 31, 2022. Artisan Partners’ debt leverage ratio, calculated in accordance with its loan agreements, was 0.6x as of Sep 30, 2023.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended upward during the past month.
The consensus estimate has shifted 51.02% due to these changes.
VGM Scores
Currently, Artisan Partners has a nice Growth Score of B, however its Momentum Score is doing a bit better with an A. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. Notably, Artisan Partners has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Artisan Partners belongs to the Zacks Financial - Investment Management industry. Another stock from the same industry, Ameriprise Financial Services (AMP), has gained 9.7% over the past month. More than a month has passed since the company reported results for the quarter ended September 2023.
Ameriprise reported revenues of $3.91 billion in the last reported quarter, representing a year-over-year change of +10.4%. EPS of $7.68 for the same period compares with $6.43 a year ago.
For the current quarter, Ameriprise is expected to post earnings of $7.70 per share, indicating a change of +11% from the year-ago quarter. The Zacks Consensus Estimate has changed -0.4% over the last 30 days.
Ameriprise has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of C.
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Artisan Partners Asset Management Inc. (APAM) : Free Stock Analysis Report
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