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What's in Store for Affiliated Managers (AMG) in Q3 Earnings?

Zacks Equity Research

Affiliated Managers Group Inc. AMG is slated to report third-quarter 2019 results on Oct 28, before the opening bell. Its earnings and revenues for the to-be-reported quarter are expected to witness year-over-year decline.

In the last reported quarter, the company’s economic earnings surpassed the Zacks Consensus Estimate. Results were adversely impacted by decline in revenues and assets under management (AUM), and higher expenses. Nonetheless, a robust liquidity position aided the company.

Affiliated Managers boasts an impressive earnings surprise history. Its earnings surpassed the consensus estimate in three of the trailing four quarters, the average beat being 1.5%.

Affiliated Managers Group, Inc. Price and EPS Surprise

Affiliated Managers Group, Inc. Price and EPS Surprise

Affiliated Managers Group, Inc. price-eps-surprise | Affiliated Managers Group, Inc. Quote

However, activities of the company in the third quarter failed to encourage analysts to revise earnings estimates upward. Thus, the Zacks Consensus Estimate for its earnings of $3.14 for the to-be-reported quarter has declined marginally over the past seven days. Also, it indicates a decline of 9% from the year-ago quarter’s reported figure.

The company’s equity investments in the third quarter are expected to have supported its top line. However, the consensus estimate for sales is pegged at $542.5 million, indicating a fall of 9.8% from the year-ago quarter’s reported figure.

Management’s Expectations for Q3

Management expects the ratio of adjusted earnings before interest, taxes, depreciation and amortization to average AUM of 10.6 basis points (bps). Further, other economic items are projected to be around $1 million.

On the cost front, management projects total interest expenses of around $20 million, up 1.5% from the last reported quarter.

Also, the company’s share of amortization and impairments are expected to be $56 million, up from $21.2 million recorded in the prior quarter.

Earnings Whispers

Now, let’s check what our quantitative model predicts.

According to our quantitative model, it cannot be conclusively predicted whether Affiliated Managers will be able to beat the Zacks Consensus Estimate in the third quarter. This is because it does not have the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or higher.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Earnings ESP: The Earnings ESP for Affiliated Managers is 0.00%.

Zacks Rank: The company currently carries a Zacks Rank #3.

Stocks That Warrant a Look

Here are some finance stocks that you may want to consider, as according to our model, these have the right combination of elements to post an earnings beat this quarter.

Santander Consumer USA Holdings Inc SC is slated to release results on Oct 30. It presently has an Earnings ESP of +1.01% and a Zacks Rank #3.

Cullen/Frost Bankers, Inc CFR is slated to release results on Oct 31. It currently has an Earnings ESP of +0.07% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Banco Macro S.A. BMA is expected to release results on Nov 26. It has an Earnings ESP of +12.20% and a Zacks Rank #3 at present.

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Macro Bank Inc. (BMA) : Free Stock Analysis Report
Cullen/Frost Bankers, Inc. (CFR) : Free Stock Analysis Report
Santander Consumer USA Holdings Inc. (SC) : Free Stock Analysis Report
Affiliated Managers Group, Inc. (AMG) : Free Stock Analysis Report
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