T Rowe Price (TROW) AI Stock Analysis

• Market Cap: $19.68B
• Dividend Yield: 5.62%
• Average Volume (3M): 2.49M
• Price to Earnings (P/E): 9.7
• Beta (1Y): 1.34
• Revenue Growth: 9.80%
• EPS Growth: 17.87%
• Country: US
• Employees: 8,158
• Sector: Financial
• Sector Strength: 87
• Industry: Asset Management
• EPS (TTM): 9.15
• Shares Outstanding: 222,242,400
• 10 Day Avg. Volume: 2,171,276
• 30 Day Avg. Volume: 2,486,179
• PEG Ratio: 0.54
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.00
• Price to Cash Flow (P/CF): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 1.22
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 6.51
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $93.45
• Price Target Upside: 5.53% Upside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 11

T Rowe Price's overall stock score is driven by its strong financial performance and attractive valuation. The company's solid profitability, low leverage, and effective cash management underpin its financial strength. The earnings call highlighted ongoing strategic efforts to address challenges in the market, while technical indicators suggest a cautious outlook. Despite some market difficulties, the company's robust dividend yield and low P/E ratio provide a compelling investment case.

Positive Factors

Expense Management

The initial read on 2025 expenses was well-received, indicating positive sentiment about future cost management.

Funds Performance

Momentum in ETFs and target date funds is promising, with well-flowed performance in Jan and Feb'25.

Partnerships

TROW announced a new insurance partnership with ARES’s insurance partner (Aspida), with TROW/OHA managing public/private credit for a portion of Aspida’s balance sheet.

Negative Factors

Earnings Estimates

The earnings per share estimate for 2025 has been decreased by 6.8% due to current dynamics.

Market Conditions

TROW's emphasis on growth-equity exposures has been a relative headwind due to March's stock market weakness.

Outflows

TROW reported $8.6B in outflows for 1Q25, including $0.7B of manager-driven distributions.

T Rowe Price Business Overview & Revenue Model

Company Description

T. Rowe Price Group, Inc. is a publicly owned investment manager. The firm provides its services to individuals, institutional investors, retirement plans, financial intermediaries, and institutions. It launches and manages equity and fixed income mutual funds. The firm invests in the public equity and fixed income markets across the globe. It employs fundamental and quantitative analysis with a bottom-up approach. The firm utilizes in-house and external research to make its investments. It employs socially responsible investing with a focus on environmental, social, and governance issues. It makes investment in late-stage venture capital transactions and usually invests between $3 million and $5 million. The firm was previously known as T. Rowe Group, Inc. and T. Rowe Price Associates, Inc. T. Rowe Price Group, Inc. was founded in 1937 and is based in Baltimore, Maryland, with additional offices in Colorado Springs, Colorado; Owings Mills, Maryland; San Francisco, California; New York, New York; Philadelphia, Pennsylvania; Tampa, Florida; Toronto, Ontario; Hellerup, Denmark; Amsterdam, The Netherlands; Luxembourg, Grand Duchy of Luxembourg; Zurich, Switzerland; Dubai, United Arab Emirates; London, United Kingdom; Sydney, New South Wales; Hong Kong; Tokyo, Japan; Singapore; Frankfurt, Germany, Madrid, Spain, Milan, Italy, Stockholm, Sweden, Melbourne, Australia, and Amsterdam, Netherlands.

How the Company Makes Money

T. Rowe Price generates revenue primarily through investment advisory fees, which are based on a percentage of assets under management (AUM). The company's core revenue streams include fees from mutual funds, investment advisory services for institutional clients, and subadvisory services for other financial entities. These fees are typically charged on a daily basis but are accrued and billed monthly or quarterly. T. Rowe Price also earns revenue from administrative and distribution fees related to its mutual funds. The company's earnings are influenced by factors such as market performance, net asset inflows or outflows, and the overall growth in assets under management. While T. Rowe Price does not rely heavily on significant partnerships, its reputation and performance history play a critical role in maintaining and expanding its client base.

T Rowe Price Financial Statement Overview

Summary

T Rowe Price shows a robust financial profile with strong profitability metrics like a Net Profit Margin of 28.81% and a solid equity position indicated by a low Debt-to-Equity Ratio of 0.03. The company effectively manages its operations with high EBIT and EBITDA margins and demonstrates strong cash flow growth.

Income Statement

T Rowe Price has demonstrated solid financial performance with a Gross Profit Margin of 51.92% and a Net Profit Margin of 28.81% for 2024, indicating efficient cost management and strong profitability. Revenue growth from 2023 to 2024 was 9.78%, reflecting positive market conditions and effective growth strategies. EBIT and EBITDA margins remain robust at 32.89% and 32.89%, respectively, showing operational efficiency.

Balance Sheet

The company maintains a healthy balance sheet with a low Debt-to-Equity Ratio of 0.03, indicating low leverage and financial stability. The Return on Equity (ROE) is strong at 19.76%, showcasing effective use of shareholder funds. The Equity Ratio of 76.80% suggests a strong equity base relative to assets, minimizing financial risk.

Cash Flow

T Rowe Price exhibits strong cash flow management with a Free Cash Flow Growth Rate of 85.07% from 2023 to 2024, driven by increased operating cash flows. The Operating Cash Flow to Net Income Ratio of 0.82 indicates efficient cash generation relative to net income. The Free Cash Flow to Net Income Ratio of 0.82 further supports the company's solid cash position.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
7.09B	6.46B	6.49B	7.67B	6.21B
	Gross Profit
3.68B	3.21B	3.57B	4.68B	3.59B
	EBIT
2.33B	1.99B	2.37B	3.71B	2.75B
	EBITDA
2.33B	2.52B	3.14B	3.91B	2.94B
	Net Income Common Stockholders
2.04B	1.79B	1.56B	3.08B	2.37B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
2.65B	2.07B	1.76B	1.52B	2.15B
	Total Assets
13.47B	12.28B	11.64B	12.52B	10.66B
	Total Debt
278.70M	397.90M	329.60M	249.20M	154.10M
	Net Debt
-2.37B	-1.67B	-1.43B	-1.27B	-2.00B
	Total Liabilities
2.02B	1.99B	1.96B	2.26B	1.39B
	Stockholders Equity
10.35B	9.51B	8.84B	9.02B	7.71B
Cash Flow		Free Cash Flow
1.26B	911.20M	2.12B	3.21B	1.70B
	Operating Cash Flow
1.69B	1.22B	2.36B	3.45B	1.92B
	Investing Cash Flow
-177.50M	-527.20M	-41.50M	-1.10B	-36.30M
	Financing Cash Flow
-936.60M	-1.08B	-2.08B	-2.99B	-1.49B

T Rowe Price Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 88.55
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TROW, the sentiment is Negative. The current price of 88.55 is above the 20-day moving average (MA) of 86.92, below the 50-day MA of 93.32, and below the 200-day MA of 105.68, indicating a neutral trend. The MACD of -1.36 indicates Negative momentum. The RSI at 48.06 is Neutral, neither overbought nor oversold. The STOCH value of 75.14 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TROW.

T Rowe Price Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TROW	74 Outperform	$19.68B	9.67	20.60%	5.62%	9.80%	17.87%
CG	70 Outperform	$13.94B	13.94	18.90%	3.58%	62.87%	―
BEN	67 Neutral	$9.86B	28.77	2.76%	6.72%	9.48%	-65.57%
STT	65 Neutral	$25.43B	9.89	11.21%	3.28%	16.34%	66.71%
CRBG	64 Neutral	$16.52B	8.03	19.20%	3.06%	1.72%	126.74%
Sector *	63 Neutral	$12.46B	9.55	8.14%	17103.96%	12.70%	-4.66%
NTRS	63 Neutral	$18.32B	8.77	17.54%	3.19%	21.00%	137.62%

T Rowe Price Corporate Events

T. Rowe Price Schedules Earnings Results Discussion

T. Rowe Price will conduct an investor conference call and webcast on February 5, 2025, to discuss its earnings results for the periods ending December 31, 2024. This event aims to provide insights into the company’s financial performance, potentially impacting its operations and stakeholder perspectives.