Q4 2024 Artisan Partners Asset Management Inc Earnings Call

Artisan Partners Asset Management Inc. APAM reported fourth-quarter 2024 adjusted net income per share of $1.05. The bottom line increased 34.6% from the prior-year quarter.

Find the latest earnings estimates and surprises on the Zacks Earnings Calendar.

Results benefitted from Global Funds and Separate account growth. The balance sheet position also improved in the reported quarter. However, rising operating expenses acted as headwinds. A sequential decline in the asset under management (AUM) balance was a spoilsport.

Results in the reported quarter excluded certain notable items. After considering these, net income available to common shareholders (GAAP basis) was $69.7 million or 97 cents per share, up from $64.8 million or 92 cents per share in the prior-year quarter.

For 2024, the company reported adjusted net income per share of $3.55. The metric increased 22.8% from the prior year. Net income was $259.7 million, up from $222.3 million in the prior year.

APAM Revenues & Expenses Rise Y/Y

Fourth-quarter revenues were $297 million, which rose 19.3% year over year.

For the year, revenues were $1.11 billion, up 14% year over year.

Management fees earned from Artisan Funds & Artisan Global Funds increased 16.1% year over year to $178.4 million. Management fees earned from Separate accounts grew 13.9% to $103.9 million.

Total operating expenses were $187.9 million, up 8.9% year over year.

Operating income was $109.1 million, up 42.8% year over year.

APAM’s Ending AUM Balance Declines Sequentially

As of Dec. 31, 2024, the ending AUM was $161.2 billion, down 3.9% from the previous quarter due to $5 billion of market depreciation, $0.8 billion of net client cash outflows and $0.2 billion of Artisan Funds' distributions, which were not reinvested.

The average AUM totaled $165.4 billion, up 1.6% from the prior quarter.

APAM’s Balance Sheet Position Improves Sequentially

Cash and cash equivalents were $201.2 million as of Dec. 31, 2024 compared with $253.9 million as of Sept. 30, 2024. Artisan Partners’ debt leverage ratio, calculated in accordance with its loan agreements, was 0.5X as of Dec. 31, 2024.

APAM’s Dividend Update

The company’s board of directors declared a variable fourth-quarter dividend of 84 cents per share of Class A common stock, representing a 2.4% increase from the prior payout. The amount will be paid out on Feb. 28 to shareholders of record as of Feb. 15, 2025.

Our Take on APAM

A decent liquidity position is expected to support financials. Also, diverse investment strategies across multiple asset classes, and investments in new teams and operational capabilities will likely drive revenues in the upcoming period. However, challenging operating backdrop and geopolitical concerns might affect the company’s AUM in the forthcoming period. A volatile trend in net outflows over the past years keeps us apprehensive.

Artisan Partners Asset Management Inc. Price, Consensus and EPS Surprise

Artisan Partners Asset Management Inc. price-consensus-eps-surprise-chart | Artisan Partners Asset Management Inc. Quote

Currently, Artisan Partners has a Zacks Rank #4 (Sell).

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

Performances of Other Asset Managers

Invesco’s IVZ fourth-quarter 2024 adjusted earnings of 52 cents per share surpassed the Zacks Consensus Estimate of 49 cents. Moreover, the bottom line increased 10.6% from the prior-year quarter.

The results primarily gained from a decline in adjusted expenses and higher adjusted net revenues. An increase in AUM balance on decent inflows was a positive for IVZ.

BlackRock’s BLK fourth-quarter 2024 adjusted earnings of $11.93 per share surpassed the Zacks Consensus Estimate of $11.44. The figure reflects a rise of 23.5% from the year-ago quarter.

BLK’s results benefited from a rise in revenues. AUM witnessed robust growth and touched the $11.55-trillion mark driven by net inflows, partially offset by market depreciation and negative forex impacts. However, higher expenses and lower non-operating income acted as headwinds.

Zacks Investment Research

By Josh Beckerman

Artisan Partners Asset Management declared a variable quarterly dividend and an annual special dividend that will pay more than their predecessors and posted higher fourth-quarter earnings.

The investment firm's quarterly payout will be 84 cents, up from 82 cents for the third quarter. The special dividend is 50 cents a share, compared with a 34-cent payout a year ago.

Artisan said fourth-quarter revenue was $297 million, up from $249 million in the 2023 fourth quarter. Adjusted earnings per share increased to $1.05 from 78 cents.

Shares rose 2.8% to $45.81 after hours.

Write to Josh Beckerman at josh.beckerman@wsj.com