Legg Mason AUM Rises in October, Fixed Income Inflows Recorded

Legg Mason Inc. LM reported marginal growth in assets under management (AUM) as of Oct 31, 2019, from the previous month. Preliminary month-end AUM came in at $791 billion, up 1.2% from the September 2019 figure of $781.8 billion.

The company’s October AUM displayed $1.8-billion fixed income inflows and alternative inflows of $0.3 billion, partly offset by liquidity and equity net outflows of $1.4 billion and $0.1 billion, respectively. Notably, alternative AUM recorded $0.2 billion of realizations. Further, positive foreign-exchange impact of $2.1 billion was a favorable factor.

Legg Mason’s equity AUM at the end of October advanced 1.9% from the prior-month figure to $207.1 billion. Fixed income AUM was up 1.5% sequentially to $449.3 billion. In addition, alternative assets increased marginally to $72.7 billion.

Rise in fixed income, equity and alternative AUM resulted in long-term AUM of $729.1 billion. The figure marks a 1.5% increase from the previous month. However, liquid assets, which are convertible into cash, were down 2.1% to $61.9 billion.

Our Viewpoint

Legg Mason has the potential to outperform its peers over the long run, backed by a diversified product mix and leverage to the changing market demography. Nonetheless, absence of continued growth in equity markets and foreign-exchange fluctuations remain headwinds.

Shares of the company have gained around 10.1% over the last three months compared with 11.6% growth recorded by the industry.

Legg Mason currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Competitive Landscape

Among other investment managers, Invesco’s IVZ preliminary month-end AUM was $1,195.2 billion, up 0.9% from the prior month. This upswing stemmed from favorable market returns, and reinvested distributions. Also, favorable foreign-exchange movement boosted the month’s AUM by $5 billion. These were partly offset by outflows in long-term AUM, money market, and non-management fee earning AUM.

Franklin Resources BEN has also announced preliminary AUM by its subsidiaries of $693.1 billion for October. Results displayed marginal increase from the $692.6 billion recorded as of Sep 30, 2019. Slight net outflows were offset by net market gains. Furthermore, the reported figure inched up 1.5% year on year.

Cohen & Steers CNS reported preliminary AUM of $72 billion as of Oct 31, 2019, up 1.6% from the prior-month level of $70.9 billion. Market appreciation of $967 million and net inflows of $333 million were partly offset by distributions of $186 million.

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Invesco Ltd. (IVZ): Free Stock Analysis Report
Franklin Resources, Inc. (BEN): Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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