SEI Investments Co.
) rose nearly 1.6% on Wednesday following its first-quarter 2014
adjusted earnings per share of 41 cents, which beat the Zacks
Consensus Estimate by a penny. Moreover, the reported figure was
up 24% from 33 cents earned in the year-ago quarter.
AMERIPRISE FINL (AMP): Free Stock Analysis
FRANKLIN RESOUR (BEN): Free Stock Analysis
INVESCO LTD (IVZ): Free Stock Analysis Report
SEI INVESTMENTS (SEIC): Free Stock Analysis
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Better-than-expected results were primarily attributable to
top-line growth, partially offset by higher expenses. Consistent
improvement in asset position and steady capital deployment
activities were the other positives.
After taking into consideration net gains from the sale of SEI
Asset Korea, net income attributable to common shareholders was
$74.8 million or 43 cents per share, up from $71.9 million or 41
cents per share in the prior-year quarter.
Behind the Headlines
Revenues at SEI Investments grew 11% year over year to $302.4
million in the reported quarter. The improvement was mainly owing
to a rise in asset management, administration and distribution
fees. However, the figure lagged the Zacks Consensus Estimate of
Total expenses were $224.0 million, up 6% from the prior-year
quarter. The increase resulted from a rise in most of the
components of expense. However, this was partially offset by a
decline in brokerage commissions, stock-based compensation,
facilities, supplies and other costs as well as depreciation
Operating income increased 31% from the year-ago quarter to $78.4
As of Mar 31, 2014, assets under management (AUM) rose 17% year
over year to $239.3 billion. Total client AUM was recorded at
$342.4 billion, up 19% from $288.6 billion as of Mar 31, 2013.
In the said quarter, SEI Investments bought back 2.0 million
shares of its common stock for $69.0 million.
Additionally, the company approved an increase in its stock
repurchase program. Management authorized an additional $200
million to the buyback plan. Hence, as of Mar 31, 2014, the
available authorization under the program was roughly $212
We believe that SEI Investment will continue to benefit from the
growing demand for risk management and alternative investment
solutions in the financial service industry. Moreover, the
company's capital deployment activities in the form of share
buybacks and dividend hikes make it an attractive pick for
investors. The company's strong asset inflows will also likely
boost its overall growth going forward.
Nevertheless, the persistent low interest rate environment,
mounting expenses and stringent regulations pose challenges.
Currently, SEI Investments has a Zacks Rank #4 (Sell).
Among other investment mangers,
Ameriprise Financial, Inc.
) are scheduled to announce results on Apr 28 and May 1
Franklin Resources Inc.
) will release second-quarter fiscal 2014 results on Apr 28.