Artisan Partners (APAM) AI Stock Analysis

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Artisan Partners

(NYSE:APAM)

68Neutral

Artisan Partners' stock score reflects strong financial performance with robust revenue growth and profitability. However, cash flow management issues and the technical analysis suggest caution. The firm's valuation is attractive, offering a compelling dividend yield. Recent earnings reveal strategic strengths but also challenges with net client outflows. The new CEO appointment is seen positively, enhancing the company's long-term growth strategy.

Artisan Partners (APAM) vs. S&P 500 (SPY)

Market Cap

$2.84B

Dividend Yield8.43%

Average Volume (3M)610.40K

Price to Earnings (P/E)9.7

Beta (1Y)1.45

Revenue Growth12.37%

EPS Growth14.69%

CountryUS

Employees584

SectorFinancial

Sector Strength78

IndustryAsset Management

Share Statistics

EPS (TTM)3.56

Shares Outstanding70,005,930

10 Day Avg. Volume553,474

30 Day Avg. Volume610,397

Financial Highlights & Ratios

PEG Ratio0.66

Price to Book (P/B)N/A

Price to Sales (P/S)2.91

Price to Cash Flow (P/CF)21.80

P/FCF Ratio20.90

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$44.76

Price Target Upside26.58% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering3

Artisan Partners Business Overview & Revenue Model

Company DescriptionArtisan Partners Asset Management Inc. is publicly owned investment manager. It provides its services to pension and profit sharing plans, trusts, endowments, foundations, charitable organizations, government entities, private funds and non-U.S. funds, as well as mutual funds, non-U.S. funds and collective trusts. It manages separate client-focused equity and fixed income portfolios. The firm invests in the public equity and fixed income markets across the globe. It invests in growth and value stocks of companies across all market capitalization. For fixed income component of its portfolio the firm invests in non-investment grade corporate bonds and secured and unsecured loans. It employs fundamental analysis to create its portfolios. Artisan Partners Asset Management Inc. was founded in 1994 and is based in Milwaukee, Wisconsin with additional offices in Atlanta, Georgia; New York City; San Francisco, California; Leawood, Kansas; and London, United Kingdom.

How the Company Makes MoneyArtisan Partners generates revenue primarily through investment management fees, which are calculated as a percentage of the assets under management (AUM). The company manages funds for individual and institutional investors, and fees are typically based on the performance and size of the investment portfolios. Artisan Partners' revenue streams are influenced by the market value of the assets it manages and the performance of its investment strategies. Additionally, the firm may earn performance-based fees if certain funds exceed predefined performance benchmarks. Artisan Partners' earnings are also affected by its ability to attract and retain clients, which is bolstered by its reputation, long-term investment performance, and client service capabilities.

Artisan Partners Financial Statement Overview

Summary

Artisan Partners demonstrates strong revenue growth and profitability, with a robust balance sheet featuring no debt. However, challenges with cash flow management and converting income into cash slightly detract from its financial performance score.

Income Statement

Positive

Artisan Partners has shown strong revenue growth, with a 14% increase from 2023 to 2024. The gross profit margin is healthy at 43.8%, and the net profit margin is solid at 23.4%. However, the decline from 2021's revenue peak indicates some volatility. The EBIT and EBITDA margins are robust at 32.9%, indicating efficient operations.

Balance Sheet

Positive

The company has a strong equity position with a debt-to-equity ratio of 0, highlighting no leverage risk in 2024. Return on equity (ROE) is impressive at 66.8%, indicating high profitability for shareholders. However, the equity ratio is moderate at 24%, suggesting moderate financial leverage.

Cash Flow

Neutral

The free cash flow has decreased significantly from 2023 to 2024, impacting the free cash flow growth rate negatively. Operating cash flow to net income ratio is low at 0.008, indicating a potential issue in converting income to cash, but the free cash flow to net income ratio remains stable at 0.008.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
1.11B	975.13M	993.30M	1.23B	899.60M
	Gross Profit
487.42M	445.74M	482.90M	664.20M	463.80M
	EBIT
366.63M	303.59M	344.10M	540.50M	358.30M
	EBITDA
459.02M	395.31M	353.31M	547.42M	365.82M
	Net Income Common Stockholders
259.75M	222.29M	206.75M	336.52M	308.50M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
409.96M	178.47M	114.80M	189.20M	155.00M
	Total Assets
1.62B	1.41B	1.31B	1.21B	1.15B
	Total Debt
300.71M	312.66M	319.90M	299.70M	292.00M
	Net Debt
32.49M	134.19M	205.10M	110.50M	137.00M
	Total Liabilities
868.84M	802.10M	899.00M	912.00M	961.00M
	Stockholders Equity
388.92M	324.15M	279.40M	296.00M	191.00M
Cash Flow		Free Cash Flow
368.09M	244.40M	293.05M	392.58M	315.58M
	Operating Cash Flow
372.84M	253.03M	312.61M	398.55M	318.68M
	Investing Cash Flow
-24.87M	-38.17M	-63.73M	-26.97M	18.75M
	Financing Cash Flow
-254.22M	-174.96M	-306.40M	-335.43M	-282.23M

Artisan Partners Technical Analysis

Technical Analysis Sentiment

Negative

Last Price35.36

Price Trends

50DMA

41.63

Negative

100DMA

42.85

Negative

200DMA

41.33

Negative

Market Momentum

MACD

-0.61

Positive

RSI

42.56

Neutral

STOCH

20.87

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For APAM, the sentiment is Negative. The current price of 35.36 is below the 20-day moving average (MA) of 39.78, below the 50-day MA of 41.63, and below the 200-day MA of 41.33, indicating a bearish trend. The MACD of -0.61 indicates Positive momentum. The RSI at 42.56 is Neutral, neither overbought nor oversold. The STOCH value of 20.87 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for APAM.

Artisan Partners Risk Analysis

Artisan Partners disclosed 39 risk factors in its most recent earnings report. Artisan Partners 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

Artisan Partners Peers Comparison

Overall Rating

UnderperformOutperform

Sector (63)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
JHG	74 Outperform	$5.16B	12.79	8.74%	5.17%	18.85%	7.96%
APO	73 Outperform	$62.00B	15.16	28.29%	1.70%	-20.40%	-13.30%
IVZ	71 Outperform	$5.74B	10.88	5.31%	6.40%	3.97%	―
TROW	70 Outperform	$19.16B	9.42	20.60%	6.04%	9.80%	17.87%
APAM	68 Neutral	$2.84B	9.67	66.31%	8.43%	12.37%	14.69%
BEN	66 Neutral	$9.20B	26.85	2.76%	7.20%	9.48%	-65.57%
Sector *	63 Neutral	$12.86B	9.17	9.14%	4.78%	16.41%	-10.11%

* Financial Sector Average

Performance Comparison

APAM

Artisan Partners

35.36

-7.33

-17.17%

APO

Apollo Global Management

108.68

-5.78

-5.05%

BEN

Franklin Resources

17.51

-8.13

-31.71%

IVZ

Invesco

12.81

-3.31

-20.53%

TROW

T Rowe Price

82.60

-29.58

-26.37%

JHG

Janus Henderson Group

30.20

-1.41

-4.46%

Artisan Partners Earnings Call Summary

Earnings Call Date: Feb 4, 2025 | % Change Since: -18.19% | Next Earnings Date: Apr 29, 2025

Earnings Call Sentiment Positive

The earnings call reflects a strong performance in terms of investment growth and returns, particularly in the credit-oriented franchises and the Developing World strategy. However, there are challenges with net client cash outflows and a decline in assets under management. Despite these challenges, the overall financial and strategic performance is solid, with a focus on long-term growth.

Highlights

Credit-Oriented Investment Franchises Growth

In 2024, the Denver-based credit team raised $1.7 billion in net inflows, and the Boston-based EMsights Capital Group raised $1.9 billion in net inflows. Collectively, they raised $3.6 billion and now manage nearly $15 billion across six strategies.

Strong Performance and Returns

The high income, emerging markets debt opportunities, and emerging market local opportunities strategies have consistently outperformed their benchmarks by 174, 720, and 241 basis points annually, respectively.

Developing World Strategy Success

Celebrating its 10th anniversary, the Developing World strategy has generated a cumulative return of 157% since inception, which is more than four times greater than the MSCI Emerging Markets Index.

Financial Growth

Fourth quarter revenues rose by 6%, adjusted operating income increased by 12%, and the adjusted operating margin improved by 180 basis points compared to the previous quarter. Full-year revenues grew by 14% compared to 2023.

Lowlights

Net Client Cash Outflows

Net client cash outflows for the December quarter were approximately $800 million, and full-year 2024 net client cash outflows were $3.7 billion.

Decline in Assets Under Management

Assets under management ended the December quarter at $161 billion, down 4% from last quarter.

Company Guidance

During the Artisan Partners' Fourth Quarter 2024 Earnings Conference Call, significant metrics and strategic insights were discussed. Artisan reported $160 billion in assets under management, noting that 13 out of 25 investment strategies achieved net inflows for the year, with 10 strategies exceeding $100 million in net inflows. The firm's fixed income business, led by Bryan Krug and the EMsights Capital Group, collectively raised $3.6 billion in net inflows in 2024, managing nearly $15 billion across six strategies. Additionally, Artisan's weighted average effective fee rate for 2024 was 67 basis points, including $12 million in performance fees earned in the fourth quarter. Financially, the fourth quarter saw a 6% revenue increase compared to the previous quarter, with adjusted operating income rising by 12% and a 180 basis point improvement in the adjusted operating margin. The firm declared a quarterly dividend of $0.84 per share and a special dividend of $0.50, reflecting an 8% dividend yield on 2024 earnings. Looking ahead, Artisan plans to continue expanding its investment platform and exploring opportunities in alternative investments.

Artisan Partners Corporate Events

Executive/Board ChangesBusiness Operations and Strategy

Artisan Partners Announces New CEO Appointment

Positive

Mar 4, 2025

On March 4, 2025, Artisan Partners Asset Management Inc. announced that Jason A. Gottlieb will succeed Eric R. Colson as Chief Executive Officer, effective June 4, 2025, following the company’s annual meeting of stockholders. Mr. Colson will transition to the role of Executive Chair and Chair of the Board, while Stephanie DiMarco will become Lead Independent Director. This leadership transition is part of a long-term succession plan, with Mr. Gottlieb’s appointment reflecting his proven track record and strategic contributions to the company. The changes are expected to support the firm’s growth and continued success in delivering outcomes for clients, employees, and shareholders.

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.