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Ameriprise Financial (AMP)
NYSE:AMP
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Ameriprise Financial
(NYSE:AMP)80Outperform
Positive Factors
AI Efficiency
Management meeting takeaways indicate that AI is enhancing efficiency at Ameriprise Financial.
Business Transformation
AMP is transforming its business from its roots as an insurance company with a wealth manager inside of a larger financial services firm into a pure asset & wealth manager.
Shareholder Returns
Shareholder return through buybacks remained strong growing to $619M which is a consistent strategy for AMP managing to buyback roughly 4-6% of diluted shares on average per year over the past few years.
Negative Factors
Earnings Miss
A&WM earnings missed expectations largely due to the impact of Fed Funds rate cuts on bank NII.
EPS Reduction
The 2025 estimated EPS is reduced due to elevated expenses.
Net Flows
Total AUM net flows were lower than expected with $(9.0)B vs $(7.8)B.
Ameriprise Financial (AMP) vs. S&P 500 (SPY)
Market Cap
$51.06B
Dividend Yield1.18%
Average Volume (3M)580.44K
Price to Earnings (P/E)15.4
Beta (1Y)1.28
Revenue Growth11.38%
EPS Growth39.25%
CountryUS
Employees8,200
SectorFinancial
Sector Strength93
IndustryAsset Management Services
Share Statistics
EPS (TTM)33.06
Shares Outstanding100,290,610
10 Day Avg. Volume544,307
30 Day Avg. Volume580,440
Financial Highlights & Ratios
PEG Ratio0.39
Price to Book (P/B)N/A
Price to Sales (P/S)2.71
Price to Cash Flow (P/CF)31.90
P/FCF Ratio21.80
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$580.60Price Target Upside16.27% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering10
Ameriprise Financial Business Overview & Revenue Model
Company DescriptionAmeriprise Financial, Inc. is a diversified financial services company headquartered in Minneapolis, Minnesota. It operates through various segments, including Advice & Wealth Management, Asset Management, and Annuities. The firm provides a comprehensive suite of financial products and services, including financial planning, retirement planning, investment advisory services, and insurance products. Ameriprise Financial is committed to helping individuals and institutions achieve their financial goals through personalized advice and a broad portfolio of investment options.
How the Company Makes MoneyAmeriprise Financial generates revenue primarily through its Advice & Wealth Management and Asset Management segments. In the Advice & Wealth Management division, the company earns fees from financial planning, managed accounts, and advisory services provided to individual clients. This includes asset-based fees, which are recurring and based on the assets under management. The Asset Management segment contributes to revenue through mutual fund management fees and institutional investment management services. Additionally, the Annuities segment provides income through the sale of variable and fixed annuity products, which offer clients retirement income solutions. Ameriprise Financial also benefits from interest and investment income generated from its own investment portfolio. Strategic partnerships with financial advisors and distribution networks further enhance its ability to reach a broader client base and increase its revenue streams.
Ameriprise Financial Financial Statement Overview
Summary
Ameriprise Financial exhibits strong financial health with significant revenue growth, improved profitability, and a solid balance sheet. Despite a decline in free cash flow, the company's effective debt management and high equity ratio underscore its stability and growth potential.Income Statement
Ameriprise Financial demonstrated strong revenue growth, increasing from $16.10 billion in 2023 to $17.93 billion in 2024, a growth rate of 7.04%. The gross profit margin remained robust at 100%, indicating effective cost management. Net profit margin improved to 18.97%, reflecting enhanced profitability. EBIT margin also increased significantly to 44.62%, showcasing operational efficiency.85
Very Positive
Balance Sheet
The company exhibits a strong equity position with an equity ratio of 92.64%, reflecting financial stability. The absence of total debt in 2024 further strengthens its balance sheet. Return on Equity (ROE) improved substantially to 2.49%, driven by increased net income and a larger equity base.90
Very Positive
Cash Flow
Free cash flow declined from $4.50 billion in 2023 to $2.89 billion in 2024, resulting in a negative free cash flow growth rate. However, operating cash flow to net income ratio stood at 0.85, indicating healthy cash generation relative to net income. The free cash flow to net income ratio was positive at 0.85, suggesting efficient cash flow management.78
Positive
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 13.83B | 17.26B | 15.54B | 14.27B | 13.49B | 11.90B | Gross Profit |
| 8.31B | 17.26B | 15.54B | 7.42B | 7.96B | 5.83B | EBIT |
| 4.52B | 4.27B | 3.23B | 3.38B | 2.97B | 1.55B | EBITDA |
| 4.32B | 4.11B | 3.08B | 3.34B | 3.07B | 2.27B | Net Income Common Stockholders |
| 3.25B | 3.40B | 2.56B | 3.15B | 3.42B | 1.53B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 7.56B | 57.18B | 7.56B | 7.10B | 7.25B | 43.13B | Total Assets |
| 175.19B | 147.69B | 175.19B | 158.47B | 175.98B | 165.88B | Total Debt |
| 5.75B | 5.47B | 5.75B | 5.38B | 5.20B | 4.94B | Net Debt |
| -1.81B | -5.03B | -1.81B | -1.71B | -2.05B | -1.90B | Total Liabilities |
| 170.46B | 176.18B | 170.46B | 154.85B | 170.29B | 160.02B | Stockholders Equity |
| 4.73B | 136.81B | 4.73B | 3.61B | 5.68B | 5.87B |
| Cash Flow | Free Cash Flow | ||||
| 4.06B | 2.89B | 4.50B | 4.22B | 3.21B | 4.48B | Operating Cash Flow |
| 4.21B | 2.89B | 4.68B | 4.41B | 3.33B | 4.62B | Investing Cash Flow |
| -8.06B | -551.00M | -9.26B | -13.58B | -4.38B | -2.89B | Financing Cash Flow |
| 4.43B | -2.08B | 4.41B | 8.43B | 1.72B | 952.00M |
Ameriprise Financial Technical Analysis
Negative
499.34
Price Trends
535.67
Negative
537.58
Negative
485.81
Positive
Market Momentum
-9.36
Positive
35.17
Neutral
22.43
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AMP, the sentiment is Negative. The current price of 499.34 is below the 20-day moving average (MA) of 527.94, below the 50-day MA of 535.67, and above the 200-day MA of 485.81, indicating a neutral trend. The MACD of -9.36 indicates Positive momentum. The RSI at 35.17 is Neutral, neither overbought nor oversold. The STOCH value of 22.43 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AMP.
Ameriprise Financial Risk Analysis
Ameriprise Financial disclosed 30 risk factors in its most recent earnings report. Ameriprise Financial 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
Ameriprise Financial Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $51.06B | 15.40 | 68.31% | 1.18% | 11.38% | 39.25% | |
71 Outperform | $48.23B | 16.05 | 7.10% | 1.92% | -28.56% | 1.14% | |
67 Neutral | $6.10B | 1.94 | 43.24% | 5.03% | 47.95% | ― | |
66 Neutral | $6.69B | 11.34 | 16.27% | 2.50% | 9.55% | 10.22% | |
65 Neutral | $56.58B | 13.98 | 15.41% | 2.65% | 6.10% | 225.22% | |
64 Neutral | $14.34B | 10.61 | 9.28% | 4.07% | 18.04% | -9.54% | |
61 Neutral | $39.18B | 14.76 | 9.79% | 4.77% | 34.25% | 11.22% |
* Financial Sector Average
Performance Comparison
AMP
Ameriprise Financial
499.34
92.62
22.77%
AIG
American International Group
81.52
8.67
11.90%
LNC
Lincoln National
35.60
10.06
39.39%
MET
Metlife
82.25
13.37
19.41%
PRU
Prudential Financial
111.24
4.97
4.68%
VOYA
Voya Financial
70.42
3.44
5.14%
Ameriprise Financial Earnings Call Summary
Earnings Call Date: Jan 29, 2025 | % Change Since: -12.94% | Next Earnings Date: Apr 28, 2025
Earnings Call Sentiment Positive
The earnings call presented a strong performance for Ameriprise, with significant growth in assets, revenue, and return on equity. The company achieved record client assets and was recognized for customer service. However, challenges included a decline in net interest income and institutional asset management outflows. Overall, the highlights significantly outweigh the lowlights.Highlights
Record Assets Under Management
Ameriprise reported assets under management, administration, and advisement of $1.5 trillion, up 10%.
Strong Revenue and Earnings Growth
Total revenues reached $4.5 billion, up 13%, and earnings were $965 million, up 18%. Earnings per diluted share increased by 23% to $9.54.
High Return on Equity
Ameriprise achieved a return on equity of 52.7%, up from 49.7% a year ago.
Wealth Management Growth
Total client assets grew to $1 trillion, up 14%, with client inflows of $11.3 billion. Wrap assets under management increased by 18% to $574 billion.
Recognition and Client Satisfaction
Ameriprise received high client satisfaction scores and was recognized by J.D. Power for outstanding customer service.
Asset Management Performance
Assets under management and advisement reached $681 billion. Nearly 70% of funds globally were above median across one- and three-year time frames.
Strong Capital Returns
Ameriprise returned $768 million in the quarter and $2.8 billion for the year, resulting in a share count reduction of 22% over five years.
Lowlights
Net Interest Income Decline
Net interest income at the bank was down sequentially and year-over-year due to Fed rate cuts and portfolio repositioning.
Institutional Asset Management Outflows
Net outflows of $3.9 billion in institutional asset management, excluding legacy insurance partner flows.
Company Guidance
During the Q4 2024 earnings call, Ameriprise Financial provided a comprehensive overview of their strong financial performance and strategic initiatives. Key metrics highlighted include assets under management, administration, and advisement reaching $1.5 trillion, a 10% increase, and total revenues rising by 13% to $4.5 billion. The company's adjusted operating earnings grew to $965 million, up 18% from the previous year, with earnings per diluted share increasing by 23% to $9.54. Ameriprise demonstrated industry-leading return on equity of 52.7%, reflecting a 3% increase from the prior year. Wealth Management saw total client assets grow by 14% to $1 trillion, driven by $11.3 billion in client inflows. The Asset Management segment reported $681 billion in assets under management and advisement and achieved strong fund performance, with 108 Columbia Threadneedle funds receiving four- and five-star Morningstar ratings. Ameriprise also noted a $768 million capital return to shareholders in the quarter, with a total of $2.8 billion returned in 2024. The company's strategic focus on digital tools, CRM, data analytics, and advisor productivity, as well as initiatives in areas like AI, are anticipated to support future growth and operational efficiency.Ameriprise Financial Corporate Events
Executive/Board Changes
Ameriprise Financial Appoints Glynis Bryan as Director
Positive
Feb 20, 2025
Ameriprise Financial announced the appointment of Glynis A. Bryan as a director and a member of its Audit and Risk Committee, effective March 1, 2025. Bryan, who has a robust background in finance and has served in leadership roles at Insight Enterprises Inc., Swift Transportation, and APL Logistics, brings extensive experience to the company. Her appointment is expected to enhance the company’s governance and strategic oversight.
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.