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Westwood Holdings Group Inc (WHG)
NYSE:WHG
US Market

Westwood Holdings Group (WHG) AI Stock Analysis

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Westwood Holdings Group

(NYSE:WHG)

Rating:62Neutral
Price Target:
$16.00
▲(0.95%Upside)
Westwood Holdings Group's overall score reflects a stable financial foundation and strategic growth initiatives. However, high valuation, weakened profitability metrics, and mixed technical signals moderate the score, with operational efficiency and market conditions as key areas for improvement.

Westwood Holdings Group (WHG) vs. SPDR S&P 500 ETF (SPY)

Westwood Holdings Group Business Overview & Revenue Model

Company DescriptionWestwood Holdings Group, Inc., through its subsidiaries, manages investment assets and provides services for its clients. The company operates in two segments, Advisory and Trust. The Advisory segment provides investment advisory services to corporate retirement plans, public retirement plans, endowments, foundations, individuals, and the Westwood Funds; and investment sub-advisory services to mutual funds, pooled investment vehicles, and its Trust segment. The Trust segment offers trust and custodial services; and participates in common trust funds that it sponsors to institutions and high net worth individuals. Westwood Holdings Group, Inc. was founded in 1983 and is based in Dallas, Texas.
How the Company Makes MoneyWestwood Holdings Group generates revenue primarily through management fees charged on the assets it manages for clients. These fees are typically based on a percentage of the assets under management (AUM) and may vary depending on the type of investment product or account. Additionally, the company may earn performance-based fees if certain investment benchmarks are met or exceeded. WHG's revenue is also influenced by market conditions, as fluctuations in the financial markets can impact the value of the assets it manages. Significant partnerships with institutional investors and financial intermediaries help to expand the company's client base and increase assets under management, further contributing to its earnings.

Westwood Holdings Group Earnings Call Summary

Earnings Call Date:Apr 30, 2025
(Q1-2025)
|
% Change Since: -4.11%|
Next Earnings Date:Jul 30, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted significant achievements such as the launch of new ETFs, a substantial sub advisory mandate win, and strong results in the institutional channel. However, there were challenges with a decline in revenue, net outflows in wealth management, and a decrease in first quarter income. While the highlights are notable, the lowlights present significant areas of concern.
Q1-2025 Updates
Positive Updates
Launch of New ETFs
Westwood launched the Westwood LBRTY Global Equity ETF, ticker symbol BFRE, at the end of the quarter. This ETF offers a distinctive approach to global equity investing by limiting exposure to authoritarian regimes while maintaining broad market exposure.
Successful Sub Advisory Mandate
Westwood won a significant sub advisory mandate with nearly $1 billion in small cap value, which funded on the second to last day of the quarter.
Growth in ETF Business
The first ETF, Westwood Salient Enhanced Midstream Income, MDST, reached its one-year anniversary with strong traction among income-seeking investors. Asset levels in the first two ETFs now exceed $100 million.
Strong Institutional Channel Results
The institutional channel delivered exceptional results in the first quarter with gross sales of $960.5 million and net inflows of $758.8 million.
Robust Pipeline Across Strategies
The pipeline remains robust across multiple strategies, with continued mandates and SMidCap value for defined contribution plans driven by the largest national consultants.
Positive Financial Position
Westwood reported a solid financial position with cash and liquid investments totaling $26.9 million and a debt-free balance sheet.
Dividend Declaration
The Board of Directors approved a regular cash dividend of $0.15 per common share payable on July 01, 2025.
Negative Updates
Revenue Decline
Total revenues for the first quarter of 2025 were $23.3 million, down from $25.6 million in the fourth quarter due to lower performance-based fees.
Net Outflows in Wealth Management
The Wealth Management business saw net flows of minus $157 million in the first quarter of 2025.
Market Depreciation Impact
Assets under management experienced market depreciation of $0.3 billion, and assets under advisement experienced market depreciation of $8 million.
Decrease in First Quarter Income
First quarter income was $0.5 million or $0.05 per share, compared with $2.1 million or $0.24 per share in the fourth quarter.
Company Guidance
During the first quarter of 2025 earnings call, Westwood Holdings Group provided extensive guidance highlighting several key metrics and strategic initiatives. The company successfully launched the Westwood LBRTY Global Equity ETF (BFRE), while its first ETF, Westwood Salient Enhanced Midstream Income (MDST), reached a one-year anniversary and, along with Enhanced Energy Income (WEEI), exceeded $100 million in assets. The firm won a significant sub-advisory mandate with nearly $1 billion in small cap value and achieved $960.5 million in gross sales and $758.8 million in net inflows in their institutional channel. The intermediary channel saw $233.1 million in gross sales and $4.5 million in net inflows. Overall, assets under management totaled $18 billion at quarter end, with institutional assets comprising $9 billion. Revenue for the quarter was $23.3 million, while non-GAAP economic earnings were $2.5 million or $0.29 per share. The firm emphasized its strong pipeline, strategic expansions, and innovative ETF offerings as pivotal to navigating market uncertainties and continuing growth.

Westwood Holdings Group Financial Statement Overview

Summary
Westwood Holdings Group shows a stable financial position with strong cash flow and a robust balance sheet characterized by low leverage. However, profitability metrics have weakened, with declines in net profit margin and return on equity, reflecting operational efficiency challenges.
Income Statement
65
Positive
Westwood Holdings Group experienced a moderate revenue growth rate of 5.5% in the latest year, supported by a gross profit margin of 35.1%. However, the net profit margin has decreased significantly to 2.3% from the previous year's 11.8%, indicating increased costs or reduced efficiency. The EBIT and EBITDA margins are relatively low at 0.9% and 0.9%, respectively, suggesting operating challenges.
Balance Sheet
75
Positive
The company maintains a robust balance sheet with a low debt-to-equity ratio of 0.03, reflecting minimal leverage and financial risk. The equity ratio stands at a strong 80.2%, highlighting a solid capital structure. However, the return on equity has decreased to 1.8%, pointing to subdued profitability.
Cash Flow
83
Very Positive
Westwood Holdings Group has demonstrated a strong cash flow position with a substantial free cash flow of $21 million in the latest year, marking a significant turnaround from the negative free cash flow the previous year. The operating cash flow to net income ratio is notably high at 9.6, underscoring strong cash generation capabilities.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue95.47M94.72M89.78M68.68M73.05M65.11M
Gross Profit49.81M38.71M36.86M28.56M30.52M22.97M
EBITDA11.18M11.46M8.27M13.12M5.96M1.41M
Net Income492.00K2.21M10.57M-4.63M9.76M-8.95M
Balance Sheet
Total Assets149.15M149.99M155.17M146.33M139.60M149.15M
Cash, Cash Equivalents and Short-Term Investments82.56M46.54M53.10M39.20M80.23M82.56M
Total Debt7.84M3.20M4.55M6.06M6.13M7.84M
Total Liabilities18.44M27.66M32.72M35.68M21.70M18.44M
Stockholders Equity130.71M120.29M120.40M110.65M117.91M130.71M
Cash Flow
Free Cash Flow19.38M21.01M-1.33M51.55M19.21M-9.86M
Operating Cash Flow20.49M21.12M-1.19M51.87M19.39M-9.77M
Investing Cash Flow-18.43M-4.61M4.11M-34.12M9.57M-4.00K
Financing Cash Flow-18.53M-18.08M-6.36M-9.10M-26.81M-25.81M

Westwood Holdings Group Technical Analysis

Technical Analysis Sentiment
Positive
Last Price15.85
Price Trends
50DMA
15.50
Positive
100DMA
15.55
Positive
200DMA
15.06
Positive
Market Momentum
MACD
0.21
Negative
RSI
56.12
Neutral
STOCH
64.67
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WHG, the sentiment is Positive. The current price of 15.85 is above the 20-day moving average (MA) of 15.40, above the 50-day MA of 15.50, and above the 200-day MA of 15.06, indicating a bullish trend. The MACD of 0.21 indicates Negative momentum. The RSI at 56.12 is Neutral, neither overbought nor oversold. The STOCH value of 64.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for WHG.

Westwood Holdings Group Risk Analysis

Westwood Holdings Group disclosed 26 risk factors in its most recent earnings report. Westwood Holdings Group 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

Westwood Holdings Group Peers Comparison

Overall Rating
UnderperformOutperform
Sector (67)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
PJPJT
74
Outperform
$5.67B28.6396.33%0.61%16.04%60.32%
73
Outperform
$178.21M10.1821.85%21.85%111.42%
SFSF
72
Outperform
$10.52B19.5211.48%1.80%12.85%20.21%
OPOPY
69
Neutral
$688.42M9.599.10%1.11%12.68%81.40%
67
Neutral
$530.42M14.405.81%3.71%5.48%-54.25%
67
Neutral
$16.51B11.239.71%3.96%11.61%-10.70%
WHWHG
62
Neutral
$148.67M555.750.33%3.76%0.52%-96.93%
* Financial Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
WHG
Westwood Holdings Group
16.00
4.43
38.29%
OPY
Oppenheimer Holdings
66.03
19.42
41.66%
SIEB
Siebert Financial
4.64
2.90
166.67%
SF
Stifel Financial
103.15
23.91
30.17%
AMRK
A-Mark Precious Metals
21.91
-9.61
-30.49%
PJT
PJT Partners
166.36
59.91
56.28%

Westwood Holdings Group Corporate Events

Shareholder MeetingsBusiness Operations and Strategy
Westwood Holdings Group Annual Meeting Approvals Impact
Neutral
May 5, 2025

At the recent Annual Meeting of Westwood Holdings Group, stockholders approved four key proposals. These included the election of directors to serve until the next annual meeting, the ratification of BDO USA, P.C. as independent auditors for 2025, the approval of the Eleventh Amended and Restated Stock Incentive Plan, and a non-binding advisory approval of executive compensation. The outcomes of these votes are expected to influence the company’s governance and operational strategies moving forward.

Business Operations and StrategyFinancial Disclosures
Westwood Holdings Reports Strong Q1 2025 Performance
Positive
Apr 30, 2025

Westwood Holdings Group reported its first quarter 2025 results, highlighting exceptional sales performance and strategic expansion in its ETF platform. The firm achieved significant success in its Institutional channel, securing a nearly $1 billion sub-advisory mandate, and recorded its best sales quarter in the Intermediary channel since 2022. Despite a decrease in quarterly revenues from the previous quarter, Westwood’s diverse product lineup and focus on high-quality investments position it well for future market uncertainties and long-term value delivery to clients and shareholders.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

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.Date of analysis: Jun 04, 2025