Investment Brokers' Q3 Earnings On Oct 25: AMP, JNS, WDR

Investment Brokerage industry, which is part of the broader Finance sector, has performed decently over the past several quarters. Notably, the U.S. equity markets have posted decent gains in July and the S&P 500’s return in the July-September quarter came in at 3.11%. Hence, following the Brexit sell-off, the quarter’s average assets under management (AUM) levels for majority of the firms witnessed a notable rise driven by a sharp move in the markets early in the quarter.

Amid this, client asset growth is expected to be favorable in the to-be-reported quarter. Also trading activity is projected to be quite decent.

However, heightened regulatory restrictions have created a challenging backdrop for traditional asset managers. Also, equity markets became volatile toward the end of the quarter and this has raised concerns regarding the future prospects of the industry as a whole.

Notably, per our Earnings Preview report, overall earnings for the Finance sector in Jul–Sep 2016 quarter are expected to be up 14.4% year over year.

Now, let’s have a look at the three investment brokerage stocks that are scheduled to report their Q3 earnings tomorrow.

Ameriprise Financial, Inc.’s (NYSE:AMP) results, which are slated to be posted after the market closes, are expected to be primarily driven by the growth in the company’s Advice & Wealth Management (AWM) segment. However, due to the persistent low interest rate environment, new sales are anticipated to have been limited during the quarter. (Read more: Ameriprise (AMP) to Report Q3 Earnings: What’s in Store?)

Nonetheless, the Zacks Consensus Estimate for the quarter indicates a year-over-year rise of 2.3%. Moreover, estimates have increased by nearly 1% over the last 30 days. However, the chances of Ameriprise beating the Zacks Consensus Estimate are low as it has an Earnings ESP of -1.25% and a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here.

Nevertheless, Ameriprise posted an average positive surprise in the trailing four quarters.

Janus Capital Group, Inc. (NYSE:JNS) is expected to publish its results before the market opens. The Zacks Consensus Estimate of 23 cents for the company reflects growth of 4.6% year over year. Estimates have been stable ahead of the company’s third-quarter 2016 results and we cannot conclusively predict an earnings beat with a Zacks Rank #2 and an Earnings ESP of 0.00%.

Furthermore, Janus Capital posted an average negative surprise of 3.6% in the trailing four quarters.

Waddell & Reed Financial, Inc. (NYSE:WDR) is slated to post its results before the market opens. Notably, the Zacks Consensus estimate for the company has increased by 2% over the last 30 days. However, it reflects a year-over-year decline of approximately 33%. Moreover, we cannot conclusively predict an earnings beat for the upcoming results as the company sports a Zacks Rank #1 with an Earnings ESP of 0.00%.

Nevertheless, Waddell & Reed posted positive earnings surprises in three of the four trailing quarters.

Stay tuned! Check back on our full write-up on earnings releases of these stocks

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