) announced a 1.5% rise in its preliminary month-end assets under
management (AUM) for the month of August 2012. The company's AUM
for the reported month was $669.7 billion compared with $659.5
billion at the end of July.
The increase in Invesco's AUM was a result of encouraging market
returns and total net inflows. In addition, favorable foreign
exchange of $1.7 billion was recorded. During the period, the
company had long-term net inflows in both active and passive AUM.
Further, Invesco sustained a disposition of $1.7 billion in AUM
associated to the earlier announced sale of certain European
Collateral Loan Obligations (CLO) contracts. The decline in
AUM pertaining to these did not affect net flows for the month as
it was recorded as an asset disposition.
In the month under review, Invesco's preliminary Active AUM was
recorded at $553.8 billion, reflecting approximately a 1.0% hike
from $548.3 billion in the prior month. Likewise, preliminary
Passive AUM was $115.9 billion, up 4.2% compared with $111.2
billion in the last month.
As of August 31, 2012, Invesco's total average assets stood at
$660.9 billion, while the total value of average active assets came
in at $549.4 billion.
At the end of August, Invesco's total equity assets grew 2.3% to
$295.2 billion from $288.6 billion recorded at the end of July.
Similarly, the company's fixed income assets improved 2.1% to
$163.1 billion from $159.7 billion in July.
Invesco's balanced assets summed up to $55.5 billion, growing 3.9%
from the previous month. However, alternative AUM fell nearly 1.9%
to $84.4 billion from $86.0 billion recorded in the prior month.
Moreover, Invesco's money market AUM came in at $71.5 billion in
the reported month, marginally falling by 0.4% from $71.8 billion
recorded in July 2012.
Earlier this week,
Franklin Resources Inc.
) declared preliminary AUM of $731.0 billion by its subsidiaries
for the month of August 2012. The company's AUM witnessed a rise of
1.7% from $718.7 billion as of July 31, 2012. Moreover, it
increased 2.0% from $716.4 billion as of August 31, 2011.
Invesco's broad diversification strategy positions it comfortably
to benefit from enhanced global investment flows. However, the
unstable U.S. dollar, volatile equity markets and mounting
competition make us apprehensive. Moreover, the operating leverage
is anticipated to improve substantially over the long term due to
the company's cost-control measures.
Invesco currently retains a Zacks #4 Rank, which translates into a
short-term Sell rating. Considering the fundamentals, we also
maintain a long-term 'Underperform' recommendation on the stock.
FRANKLIN RESOUR (BEN): Free Stock Analysis
INVESCO LTD (IVZ): Free Stock Analysis Report
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