Core Insights - Moretus Research provides high-quality equity research focused on U.S. public markets, aiming to deliver clarity, conviction, and alpha for serious investors [1] - The research methodology emphasizes a structured framework to identify companies with durable business models and mispriced cash flow potential, while also considering intelligent capital allocation [1] - Valuation practices are based on sector-relevant multiples tailored to each company's business model, emphasizing comparability and relevance [1] Research Focus - Moretus Research targets underappreciated companies that are undergoing structural changes or temporary dislocations, where disciplined analysis can yield asymmetric returns [1] - The research combines rigorous fundamental analysis with a judgment-driven process, avoiding noise and overly complex forecasting [1] - The firm aims to elevate the standard for independent investment research by providing actionable insights and a strong filter for essential factors in equity analysis [1]

Core Insights - T. Rowe Price has launched two new active transparent equity ETFs: T. Rowe Price Global Equity ETF (TGLB) and T. Rowe Price International Equity Research ETF (TIER), which began trading on NYSE Arca [1][2] Fund Details - TGLB focuses on global developed markets, aiming for a concentrated portfolio of 45-60 high conviction investments, maintaining geographic exposures similar to the MSCI World Index [3] - TIER employs fundamental research to create a diversified portfolio of 300-500 securities, aligning with the MSCI All Country World ex USA Index, covering both developed and emerging markets outside the U.S. [4] Management and Strategy - TGLB is managed by Peter Bates, who has 21 years of experience at T. Rowe Price, while TIER is co-managed by a team of six investment professionals [4][5] - The new ETFs are part of T. Rowe Price's strategy to enhance access to international investing options and leverage its global equities research capabilities [5] Company Overview - T. Rowe Price manages $1.62 trillion in client assets as of May 31, 2025, with a significant portion related to retirement [6] - The firm has a long-standing reputation for investment excellence and independent proprietary research, emphasizing a culture of integrity and client interests [6]

Core Insights - Oak Hill Advisors (OHA) acted as the Administrative Agent and Lead Left Arranger for the private senior debt financing for Montagu Private Equity's acquisition of Tyber Medical, a prominent orthopedic device manufacturer [1][2] - The acquisition will merge Tyber Medical with Montagu's existing portfolio companies, Resolve Surgical Technologies and Intech Medical, to form a scaled contract development and manufacturing organization (CDMO) [2] - OHA's extensive experience in the CDMO sector enabled it to efficiently assess the financing opportunity [3] Company Insights - Tyber Medical specializes in orthopedic devices, providing FDA-cleared and CE-marked implants for spinal, extremity, and trauma markets, with over 50 systems released since its inception in 2012 [7] - Montagu Private Equity focuses on mid-market investments, particularly in businesses with essential products in growing markets, managing €14 billion in assets [8][9] - OHA has approximately $95 billion in assets under management across various credit strategies as of March 31, 2025, emphasizing long-term partnerships and customized credit solutions [5][6]

Company Performance - T. Rowe Price (TROW) closed at $93.21, reflecting a +1.78% increase from the previous day, outperforming the S&P 500 which gained 0.94% [1] - Over the past month, TROW shares have decreased by 6.61%, while the Finance sector saw a slight loss of 0.56% and the S&P 500 gained 1.67% [1] Earnings Expectations - The upcoming earnings report is expected to show an EPS of $1.99, representing an 11.95% decline compared to the same quarter last year [2] - Revenue is projected at $1.7 billion, down 2.16% from the previous year [2] - For the full year, analysts anticipate earnings of $8.26 per share and revenue of $6.92 billion, indicating changes of -11.47% and -2.5% respectively from last year [3] Analyst Estimates - Recent changes in analyst estimates for T. Rowe Price suggest a shifting business landscape, with positive revisions indicating optimism about profitability [4] - The Zacks Rank system, which incorporates estimate changes, currently ranks T. Rowe Price at 3 (Hold) [6] Valuation Metrics - T. Rowe Price has a Forward P/E ratio of 11.09, which is higher than the industry average of 10.84 [7] - The company’s PEG ratio stands at 2.97, compared to the Financial - Investment Management industry average PEG ratio of 1.28 [7] Industry Context - The Financial - Investment Management industry is currently ranked 167 out of over 250 industries, placing it in the bottom 33% [8] - Research indicates that industries in the top 50% outperform those in the bottom half by a factor of 2 to 1 [8]

Core Viewpoint - T. Rowe Price has launched three new active transparent equity ETFs, expanding its lineup to a total of 22 offerings, aimed at providing long-term capital appreciation through sector-specific investments [1][2][4]. Group 1: New ETF Launches - The newly launched ETFs are T. Rowe Price Financials ETF (TFNS), T. Rowe Price Health Care ETF (TMED), and T. Rowe Price Natural Resources ETF (TURF) [1][2]. - Each ETF has an expense ratio of 0.44% and seeks to invest at least 80% of its net assets in their respective sectors [2][3][4]. Group 2: Investment Strategies - TFNS focuses on the financial services industry, typically maintaining a portfolio of 50-70 companies [2]. - TMED targets health care innovations, with a diversified portfolio of 100 to 150 stocks across biotechnology, pharmaceuticals, and health care services [3]. - TURF invests in natural resource companies, primarily in energy, minerals, and agriculture, holding 60-80 securities globally [4]. Group 3: Company Background - T. Rowe Price, founded in 1937, manages USD $1.62 trillion in assets as of May 31, 2025, and is known for its investment excellence and active management approach [5]. - The firm has a commitment to growing its active ETF business and aims to deliver compelling investment ideas through rigorous global research [5].

Core Viewpoint - The midyear outlook for global financial markets indicates a shift towards deglobalization, a reconfiguration of global trade due to tariffs, and an expansion of stock market opportunities beyond U.S. equities and mega-cap tech stocks, alongside a bond market regime change driven by trade policy and German fiscal expansion [1][2]. Economic Outlook - The global economy is facing pressures from trade war fallout, which could slow growth, with U.S. fiscal and tax policy expected to be significant in the latter half of the year [6]. - The likelihood of a global recession has increased, particularly with the U.S. leading the downturn, resulting in a longer period of subpar growth characterized by higher unemployment and inflation [5][7]. Equity Market Insights - There is an anticipated broadening of equity markets, reducing the concentration on U.S. and mega-cap stocks, favoring value stocks and select emerging markets [4][6]. - Active management is expected to outperform in the current challenging market environment, which includes higher interest rates and increased volatility [2]. Fixed Income Landscape - The U.S. tariffs and significant German fiscal expansion have altered the global fixed income landscape, leading to a weaker outlook for developed market sovereign bonds while improving prospects for credit and some emerging markets [5][6]. - Above-target inflation is noted in some developed markets, particularly the U.S., affecting corporate bonds which are entering an economic downturn with historically high credit quality [6]. Multi-Asset Strategy - T. Rowe Price emphasizes inflation protection and equity diversification in its multi-asset portfolios, suggesting that inflation-protected bonds and real assets can serve as effective hedges against expected inflation [6]. - More attractive valuations are leading to a preference for international and value equities in multi-asset portfolio allocations [6].

Group 1 - T. Rowe Price Group is an asset manager with an 88-year operating history, recognized for its ability to compound returns over time [1] - The company focuses on identifying high-quality companies with durable competitive advantages and strong balance sheets [1] - The investment strategy aims to purchase shares when they are available at irrational prices in the market [1]

Core Viewpoint - T. Rowe Price Group has experienced a decline of -7% since the previous analyses in July and September 2023, indicating a period of stagnation for the company [1]. Company Analysis - The company has been characterized as "dead money" over the recent months, reflecting a lack of significant movement in its stock price [1]. - The analyst has a beneficial long position in T. Rowe Price Group shares, indicating confidence in the company's future performance despite recent underperformance [2]. Market Context - The performance of T. Rowe Price Group is part of a broader market trend where past performance does not guarantee future results, highlighting the inherent risks in investment [3].

Core Viewpoint - T. Rowe Price Group, Inc. (TROW) reported a preliminary assets under management (AUM) of $1.56 trillion for April 2025, indicating a slight decrease from the previous month, alongside net outflows of $3.5 billion [1] AUM Performance Breakdown - As of the end of April, TROW's equity products amounted to $767 billion, showing a marginal decrease from the prior month [2] - Fixed income products, including money market, increased by 1% to $198 billion [2] - Multi-asset products totaled $545 billion, reflecting a slight increase from the previous month [2] - Alternative products remained stable at $53 billion compared to the prior month [2] - Target date retirement portfolios registered $485 billion, which saw a marginal rise from the previous month [3] Company Outlook - The company's diversified business model and ongoing efforts are expected to support top-line growth in the future, providing resilience amid market fluctuations [4] - However, the decline in AUM balance is viewed as discouraging, and there are concerns regarding the company's overdependence on investment advisory fees [4] Market Performance - Over the past six months, TROW shares have decreased by 17%, compared to a 9.4% decline in the industry [5] - T. Rowe Price currently holds a Zacks Rank of 4 (Sell) [7] Performance of Other Asset Managers - Franklin Resources, Inc. (BEN) reported a preliminary AUM of $1.53 trillion as of April 30, 2025, which decreased marginally due to long-term net outflows of $10 billion [8] - Virtus Investment Partners, Inc. (VRTS) announced a preliminary AUM of $163.7 billion as of April 30, 2025, down 2.2% from the previous month, primarily due to net outflows in various accounts [9]

Financial Data and Key Metrics Changes - The company closed 2024 with $1.61 trillion in assets under management and reported $43.2 billion in net client outflows, which were reduced by half year over year [32] Business Line Data and Key Metrics Changes - No specific data on individual business lines was provided in the meeting Market Data and Key Metrics Changes - No specific market data or key metrics changes were discussed in the meeting Company Strategy and Development Direction and Industry Competition - The company emphasized the importance of its associates' dedication to clients and the firm, which drives confidence in the path ahead [32] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the future, attributing it to the dedication of associates and the firm's commitment to clients [32] Other Important Information - The company held a virtual annual meeting, which has become standard for many public companies, citing efficiency and accessibility for shareholders [25] Q&A Session All Questions and Answers Question: How does the compensation committee use the compensation actually paid total compensation figures in its calculation of the CEO target total compensation award for the upcoming year? - The compensation committee evaluates the CEO's performance independently each year and does not consider previous years' stock awards in determining the current year's award [21][22] Question: Why have in-person annual meetings not resumed after COVID? - The company finds virtual meetings to be efficient and has not received significant requests from shareholders to change the meeting format [25][26]