What's in the Offing for T. Rowe Price This Earnings Season?

Core Viewpoint - T. Rowe Price Group, Inc. is expected to report improved quarterly revenues and earnings for Q4 2024 compared to the previous year, despite facing challenges such as net outflows and fluctuating market conditions [1][4]. Group 1: Earnings and Revenue Estimates - The Zacks Consensus Estimate for T. Rowe Price's fourth-quarter earnings is $2.23 per share, reflecting a year-over-year increase of 29.7% [9]. - The consensus estimate for total revenues is $1.88 billion, indicating a growth of 14.6% from the prior-year quarter [10]. - The company has consistently surpassed the Zacks Consensus Estimate in the last four quarters, with an average surprise of 8.81% [2]. Group 2: Asset Management and Market Performance - As of December 31, 2024, T. Rowe Price's preliminary assets under management (AUM) stood at $1.61 trillion, a decrease of 3.6% from September 30, 2024, primarily due to poor equity market performance [4]. - The Zacks Consensus Estimate for total AUM is $1.64 trillion, suggesting a sequential increase of 3.2% [5]. - The S&P 500 Index rose by 2.4% in the October-December quarter, indicating favorable market conditions, although equity markets lagged behind fixed-income performance [3]. Group 3: Expenses and Financial Outlook - Operating expenses for T. Rowe Price are estimated to rise to $1.33 billion, reflecting a 5.7% increase on a sequential basis due to investments in technology and client acquisition [7]. - The consensus estimate for investment advisory fees is $1.68 billion, indicating a decline of 2.9% sequentially [5]. - The consensus estimate for administrative, distribution, and servicing fees is $154 million, implying a 4.1% increase from the previous quarter [6]. Group 4: Competitive Landscape - Invesco reported adjusted earnings of 52 cents per share, surpassing estimates and showing a 10.6% increase from the prior year, driven by reduced expenses and higher net revenues [11]. - BlackRock's adjusted earnings of $11.93 per share exceeded estimates, with a 23.5% year-over-year increase, supported by robust AUM growth despite challenges from higher expenses [12].