Invesco Ltd. ( IVZ )
announced a 5.4% fall in its preliminary month-end assets under
management (AUM) for the month of May. The company's AUM for the
reported month was $632.1 billion compared with $668.4 billion at
the end of April 2012.
Invesco's AUM declined as a result of market depreciation,
long-term net outflows and unfavorable foreign exchange worth $7.1
billion. Total long-term outflows were largely driven by Passive
outflows from the PowerShares DB and PowerShares QQQ products, as
well as a stable value client termination reported in Active fixed
income.
Invesco's preliminary Active AUM totaled $528.6 billion at the
end of May, reflecting 5.5% decline from $559.1 billion in the
prior month. Likewise, in the month under review, preliminary
Passive AUM was $103.5 billion, down 5.3% compared with $109.1
billion in April.
As of May 31, 2012, Invesco's average assets stood at $658.0
billion, while the total value of average active assets came in at
$549.5 billion.
At May-end, Invesco's total equity assets declined 8.7% to
$273.7 billion from $299.8 billion in April. Similarly, the
company's fixed income assets also dipped 1.2% to $153.7 billion
from $155.5 billion in April.
Invesco's balanced assets summed up to $49.4 billion, decreasing
3.9% from the previous month. Further, alternative AUM also fell
4.2% to $84.0 billion from $87.7 billion recorded in the prior
month.
Likewise, Invesco's money market AUM arrived at $71.3 billion
(including $67.2 billion in institutional money market AUM and $4.1
billion in retail money market AUM) in the reported month, going
down 3.6% from $74.0 billion, recorded in April 2012.
Peer Performance
Concurrently, Franklin Resources Inc. ( BEN )
declared its preliminary month-end AUM for May 2012. The company
reported preliminary AUM of $683.5 billion for its subsidiaries, as
of May 31, 2012, a dip of 5.9% from $726.4 billion as of April 30,
2012.
Our Take
Long-term investment performance of Invesco has been improving,
owing to the recovering global equity market, which is further
expected to boost the company's operating results. Moreover, the
operating leverage is anticipated to improve substantially over the
long term due to the company's cost control initiatives.
Invesco's broad diversification comfortably positions it to
benefit from enhanced global investment flows. However, the
volatile U.S. dollar, unstable equity markets and mounting
competition make us apprehensive.
Invesco currently retains a Zacks #3 Rank, which translates into
a short-term Hold rating.
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INVESCO LTD (IVZ): Free Stock Analysis Report
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