Ameriprise (AMP) Q4 Earnings Miss Estimates, Costs Decline

Ameriprise Financial’s (NYSE:AMP) fourth-quarter 2019 adjusted operating earnings per share of $4.20 lagged the Zacks Consensus Estimate of $4.24. However, the figure was 10.5% higher than the year-ago quarter.

The company recorded higher revenues in the quarter. Moreover, growth in assets under management (AUM) and assets under administration (AUA) supported results to some extent. Further, a decline in expenses was a tailwind.

After taking into consideration several significant items, net income was $463 million or $3.53 per share, down from $539 million or $3.76 per share reported in the prior-year quarter.

For 2019, adjusted operating earnings per share of $16.10 lagged the Zacks Consensus Estimate of $16.17. However, the figure was 10% higher than that reported in 2018. Net income (GAAP basis) for the year was $1.89 billion or $13.92 per share, down from $2.10 billion or $14.20 per share reported in 2018.

Revenues Improve, Expenses Decline

Quarterly net revenues (on a GAAP basis) were $3.29 billion, up 3.4% year over year. The figure beat the Zacks Consensus Estimate of $2.99 billion. On an operating basis, total adjusted net revenues were $3.05 billion, down 3.9% year over year.

For 2019, net revenues (on a GAAP basis) were $12.97 billion, up 1% year over year. Moreover, the figure beat the Zacks Consensus Estimate of $12.03 billion.

Adjusted quarterly operating expenses were $2.40 billion, down 4.4% from the prior-year quarter.

AUM & AUA Improve

As of Dec 31, 2019, total AUM and AUA was $973.45 billion, up 18.3% year over year.

Capital Deployment

In the reported quarter, Ameriprise returned $0.7 billion to shareholders in forms of share repurchases and dividends.

Our Take

Improving AUM balance and restructuring initiatives (including the sale of Home & Auto division and the launch of federal savings bank) are expected to continue supporting the company. Moreover, its enhanced capital deployments reflect a strong balance sheet position and will likely continue to enhance shareholder value. However, significant outflows in the Asset Management segment are expected to hamper financials.

Ameriprise currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance & Release Date of Other Investment Managers

BlackRock, Inc.’s (NYSE:BLK) fourth-quarter 2019 adjusted earnings of $8.34 per share surpassed the Zacks Consensus Estimate of $7.67. Moreover, the figure was 37.2% higher than the year-ago quarter’s number.

Cohen & Steers’ (NYSE:CNS) fourth-quarter 2019 adjusted earnings of 74 cents per share surpassed the Zacks Consensus Estimate of 67 cents. Also, the bottom line was 32.1% higher than the year-ago quarter figure.

Affiliated Managers Group, Inc. (NYSE:AMG) is slated to announce results on Feb 3.

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