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Affiliated Managers Group (AMG)
NYSE:AMG
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Affiliated Managers
(NYSE:AMG)63Neutral
Positive Factors
Earnings
Q1/25 earnings guidance expects adjusted EBITDA to be above consensus.
Valuation
AMG is trading at a discount to its peer group, which supports the OUTPERFORM investment rating.
Negative Factors
Earnings Guidance
Q4/24 earnings guidance below consensus, with expected adjusted EBITDA and economic earnings per share lower than estimates.
Affiliated Managers (AMG) vs. S&P 500 (SPY)
Market Cap
$4.73B
Dividend Yield0.02%
Average Volume (3M)215.33K
Price to Earnings (P/E)10.7
Beta (1Y)0.82
Revenue Growth-6.77%
EPS Growth-14.55%
CountryUS
Employees4,100
SectorFinancial
Sector Strength93
IndustryAsset Management Services
Share Statistics
EPS (TTM)14.68
Shares Outstanding29,257,013
10 Day Avg. Volume262,764
30 Day Avg. Volume215,332
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)2.32
Price to Cash Flow (P/CF)5.60
P/FCF Ratio5.60
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$205.33Price Target Upside28.68% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering6
Affiliated Managers Business Overview & Revenue Model
Company DescriptionAffiliated Managers Group, Inc. (AMG) is a global asset management company that partners with boutique investment management firms. Through its affiliates, AMG provides a diverse range of investment products and services, including mutual funds, institutional funds, and high-net-worth investment solutions. The company operates across various sectors, including equities, fixed income, and alternative investments, catering to a broad spectrum of clients worldwide.
How the Company Makes MoneyAMG makes money by acquiring equity stakes in boutique investment management firms, referred to as affiliates. These affiliates manage assets and generate revenue through management fees and performance-based fees from their clients' assets under management (AUM). AMG benefits from these revenue streams by taking a share of the fees earned by its affiliates, while also supporting their growth through strategic guidance and operational resources. Additionally, AMG may receive income from its own investments in certain financial products or through capital appreciation of its equity interests in affiliates. Significant factors contributing to AMG's earnings include the performance of global financial markets, the success and growth of its affiliates, and the company's ability to attract and retain high-quality investment firms.
Affiliated Managers Financial Statement Overview
Summary
Affiliated Managers presents a mixed financial picture. While the company maintains strong gross profitability and a healthy equity base, declining revenues and recent negative free cash flow highlight underlying challenges. The absence of debt in TTM is a positive development, but the overall financial trajectory indicates potential concerns over cash flow sustainability and net income pressure.Income Statement
The company shows a mixed performance in the income statement. The Gross Profit Margin for TTM is strong at 84.07%. However, the Net Profit Margin has decreased to 37.62% compared to the previous year, indicating some pressure on net income. Revenue has declined over the past two years, with a significant drop of 26.33% from 2022 to TTM. The EBIT Margin is solid at 41.55%, but lower than in previous years, suggesting potential efficiency challenges.65
Positive
Balance Sheet
The balance sheet is fairly robust with no total debt reported in TTM, significantly improving the Debt-to-Equity ratio. The Equity Ratio is healthy at 37.87%, indicating a solid equity base. Moreover, the Return on Equity for TTM is strong at 17.05%, demonstrating good profitability against shareholder investments. However, the overall equity has decreased slightly over the past years, which should be monitored.75
Positive
Cash Flow
Cash flow metrics indicate some concerns. The Free Cash Flow has turned negative in TTM, from a positive $861.9 million the previous year, highlighting issues in cash generation. The lack of Operating Cash Flow data for TTM prevents a full analysis, but the previous year's Operating Cash Flow to Net Income Ratio was sound. The cash flow statement suggests potential liquidity issues that need addressing.50
Neutral
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 2.48B | 2.04B | 2.06B | 2.33B | 2.41B | 2.03B | Gross Profit |
| 1.40B | 1.13B | 1.15B | 1.26B | 1.37B | 1.14B | EBIT |
| 1.07B | 1.06B | 792.10M | 1.75B | 1.13B | 566.60M | EBITDA |
| 1.08B | 1.07B | 1.28B | 1.82B | 1.19B | 726.20M | Net Income Common Stockholders |
| 699.50M | 511.60M | 672.90M | 1.15B | 890.10M | 427.00M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 1.01B | 1.01B | 1.27B | 1.15B | 987.00M | 1.11B | Total Assets |
| 8.83B | 8.83B | 9.06B | 8.88B | 8.88B | 7.89B | Total Debt |
| 2.62B | 2.62B | 2.54B | 2.54B | 2.49B | 2.31B | Net Debt |
| 1.67B | 1.67B | 1.72B | 2.11B | 1.58B | 1.27B | Total Liabilities |
| 4.18B | 4.18B | 4.10B | 4.24B | 4.49B | 3.90B | Stockholders Equity |
| 3.35B | 3.35B | 3.59B | 3.23B | 2.79B | 2.78B |
| Cash Flow | Free Cash Flow | ||||
| 1.20B | 928.70M | 861.90M | 1.04B | 1.25B | 1.00B | Operating Cash Flow |
| 1.21B | 932.10M | 874.30M | 1.05B | 1.26B | 1.01B | Investing Cash Flow |
| -585.00M | 379.10M | 264.50M | -109.90M | -583.70M | -53.70M | Financing Cash Flow |
| -772.50M | -1.18B | -758.30M | -1.40B | -798.30M | -455.40M |
Affiliated Managers Technical Analysis
Negative
159.57
Price Trends
178.35
Negative
182.96
Negative
175.02
Negative
Market Momentum
-4.77
Positive
32.83
Neutral
24.05
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AMG, the sentiment is Negative. The current price of 159.57 is below the 20-day moving average (MA) of 168.04, below the 50-day MA of 178.35, and below the 200-day MA of 175.02, indicating a bearish trend. The MACD of -4.77 indicates Positive momentum. The RSI at 32.83 is Neutral, neither overbought nor oversold. The STOCH value of 24.05 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AMG.
Affiliated Managers Risk Analysis
Affiliated Managers disclosed 23 risk factors in its most recent earnings report. Affiliated Managers reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Affiliated Managers Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $76.89B | 18.81 | 28.29% | 1.37% | -20.40% | -13.30% | |
68 Neutral | $15.73B | 15.71 | 18.90% | 3.21% | 62.87% | ― | |
67 Neutral | $103.15B | 35.44 | 13.23% | 0.61% | 42.19% | -18.20% | |
65 Neutral | $185.29B | 41.98 | 36.95% | 2.71% | 21.25% | 97.42% | |
64 Neutral | $14.34B | 10.61 | 9.28% | 4.07% | 18.04% | -9.54% | |
63 Neutral | $4.73B | 10.70 | 14.75% | 0.02% | -6.77% | -14.55% | |
54 Neutral | C$124.40B | 50.76 | 21.63% | 2.73% | ― | ― |
* Financial Sector Average
Performance Comparison
AMG
Affiliated Managers
159.57
0.85
0.54%
APO
Apollo Global Management
132.40
25.14
23.44%
KKR
KKR & Co
115.27
18.44
19.04%
BX
Blackstone Group
145.15
23.80
19.61%
CG
Carlyle Group
43.00
-2.43
-5.35%
TSE:BAM
Brookfield Asset Management Ltd. Class A
75.98
21.33
39.03%
Affiliated Managers Earnings Call Summary
Earnings Call Date: Feb 6, 2025 | % Change Since: -12.52% | Next Earnings Date: May 5, 2025
Earnings Call Sentiment Neutral
AMG reported record earnings and significant growth in private markets and liquid alternatives, supported by strategic investments and share buybacks. However, the company faced challenges with net outflows and declining performance in equities and adjusted EBITDA.Highlights
Record Economic Earnings Per Share in 2024
AMG delivered record economic earnings per share in 2024 with full year earnings up 10% year-over-year, demonstrating the positive impact of their disciplined capital allocation strategy.
Successful Fundraising in Private Markets
AMG's private market affiliates raised $24 billion during the year, reflecting annualized organic growth of approximately 20% and strong demand for specialized strategies.
Expansion in Liquid Alternatives
AMG observed $2 billion of net inflows in liquid alternatives for the second consecutive quarter, driven by affiliates like AQR, Winton, Systematica, and Garda.
Strategic Investment in NorthBridge Partners
AMG announced a minority investment in NorthBridge Partners, a private markets manager specializing in industrial logistics real estate, aligning with AMG's strategy to invest in high growth areas.
Strong Balance Sheet and Share Buybacks
AMG strengthened its balance sheet by issuing $850 million of long-duration debt and repurchased $700 million in shares, equivalent to 13% of shares outstanding, highlighting financial flexibility.
Lowlights
Net Client Cash Outflows
AMG experienced net client cash outflows of $8 billion in the quarter, primarily due to industry headwinds in equities, despite strength in alternatives.
Decline in Adjusted EBITDA
Fourth quarter adjusted EBITDA was $282 million, down 5% year-over-year, influenced by lower net performance fees compared to the previous year.
Equities Outflows
Equities saw net outflows of approximately $16 billion in the quarter, reflecting industry and near-term performance headwinds.
Company Guidance
During the AMG Fourth Quarter 2024 Earnings Conference Call, the company provided a comprehensive overview of its financial performance and strategic direction. They reported record economic earnings per share for 2024, with full-year earnings up by 10% year-over-year, driven by the company's increased exposure to alternatives and disciplined capital allocation strategy. AMG's private market affiliates raised approximately $24 billion during the year, achieving annualized organic growth of around 20%. The company announced a minority investment in NorthBridge Partners, a private markets manager specializing in industrial logistics real estate. Looking ahead to the first quarter of 2025, AMG anticipates adjusted EBITDA in the range of $220 million to $230 million and economic earnings per share between $5.02 and $5.26. With a strong balance sheet and significant momentum, AMG plans to repurchase at least $400 million in shares in 2025, while continuing to focus on new investment opportunities and enhancing shareholder value.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.