Invesco Delivers Strong Growth, Increases Dividend


Investment managerInvesco ( IVZ ) is making shareholders happy on two fronts: It's delivering growth and higher dividends.

On Tuesday, the Atlanta-based company said its adjusted Q1 earnings climbed 18% to 52 cents a share. That marked its best performance in seven quarters and it beat views by a nickel.

Invesco's revenue rose 10% to $1.14 billion, slightly edging expectations. The company had some spotty top-line results in parts of 2011 and 2012, but has now delivered two straight quarters of double-digit sales growth.

The company's assets under management (AUM) rose 8% to $729.3 billion in the first quarter from a year ago. Since the end of 2012, AUM grew 6%.

Asset managers have benefited as the stock market rallied in recent months. The S&P 500 hit a record high Tuesday. During the quarter, Invesco reported record net inflows of $19.2 billion.

Based on its strong results, Invesco raised its quarterly dividend by 30% to 22.5 cents a share. The new rate represents a more than 100% increase from levels in March of 2011. Invesco will pay the dividend June 7 to shareholders of record May 17.

On an annual basis, Invesco pays 90 cents a share, which works out to a yield of 2.8%. Its yield is higher than that of the S&P 500, but still one of the lowest in the Finance-Investment Management group. Companies in the group run the gamut from giant investment firms to small asset managers that invest in mortgage-backed securities.

Invesco cleared a 28.59 entry from a cuplike flat base on March 14, but volume was just mildly above average. Still, the stock has ridden its 10-week line higher. While Invesco is extended, investors should watch for pullbacks for a potential new entry point.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Personal Finance , Investing Ideas

Referenced Stocks: IVZ

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