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Cohen & Steers' (CNS) Q3 Earnings Beat on Higher Revenues

Zacks Equity Research

Cohen & Steers’ CNS third-quarter 2019 adjusted earnings of 65 cents per share beat the Zacks Consensus Estimate of 63 cents. Also, the bottom line was 1.6% higher than the year-ago quarter figure.

Results benefited from improvement in assets under management (AUM) and higher revenues. However, rise in expenses was a headwind.

Net income available to common stockholders (GAAP basis) was $34 million or 70 cents per share, up from $30.8 million or 65 cents per share in the prior-year quarter.

Revenues Increase, Expenses Rise

Revenues (GAAP basis) were $105 million in the quarter, up 6.7% from the year-ago quarter. An increase in investment advisory and administration fees, and distribution and service fees supported this upside.

Total expenses (GAAP basis) amounted to $64.8 million, up 9.7% year over year. This increase was largely due to rise in employee compensation and benefits expenses, and distribution and service fees.

Operating income (GAAP basis) was $40.1 million, up 2.3% year over year.

Total non-operating income was $6.6 million, up substantially from $1 million.

AUM Improves

As of Sep 30, 2019, AUM was $70.8 billion, up 11.8% from the year-earlier quarter. The company witnessed net inflows of $1.1 billion in the quarter against outflows of $76 million a year ago.

Also, average AUM totaled $68.6 billion, up nearly 7.7%.

Our Take

The company’s diverse investment products are expected to continue supporting revenue growth. While increasing expenses, as witnessed in the third-quarter, are likely to hurt profitability to some extent, continuous rise in AUM is expected to support growth.

Cohen & Steers Inc Price, Consensus and EPS Surprise

 

Cohen & Steers Inc Price, Consensus and EPS Surprise

Cohen & Steers Inc price-consensus-eps-surprise-chart | Cohen & Steers Inc Quote

Currently, Cohen & Steers sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Performance & Release Dates of Other Asset Managers

BlackRock, Inc.’s BLK third-quarter 2019 adjusted earnings of $7.15 per share surpassed the Zacks Consensus Estimate of $6.95. However, the figure was 4.9% lower than the year-ago quarter’s number.

Ameriprise Financial AMP and Invesco IVZ are slated to report quarterly results on Oct 23.

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