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What We Can Expect for Affiliated Managers Group

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Future outlook

Market analysts expect Affiliated Managers Group (AMG) to report EPS (earnings per share) of $3.23 in 2Q17, a rise of 0.62% from 1Q17. This rise is expected mainly due to global institutional companies and retail clients increasing their allocations towards active value-added products and leaning towards passive beta exposure. Passive beta exposure means making investments in stocks with a lower beta, thereby reducing the risk of investments. Whereas Affiliated Managers Group (AMG) is a fund of funds, alternative asset managers (XLF) Apollo Global Management (APO), AllianceBernstein (AB), and Ameriprise Financial (AMP) invest funds directly into equity or debt asset classes.

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Affiliated Managers posted EPS of $3.21 in 1Q17, a rise of 10% YoY (year-over-year). The EPS beat analysts’ estimate of $3.18 on the back of investment performance and a strong performance by affiliates. In 1Q17, AMG’s affiliates’ alternative products reported positive cash flow. However, AMG experienced outflow from its US equities, which impacted its 1Q17 results. As of March 31, 2017, AMG’s assets under management stood at $754 billion, a rise of 17% YoY.

Outflow

Affiliates of Affiliated Managers Group have performed well across a diverse array of alternative products. Though strong cash flow was reported by AMG’s affiliates in 1Q17, AMG experienced negative flow, with a huge outflow from US equities and global equity. In 1Q17, AMG’s adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) stood at $243.8 million, a rise of 13% YoY. This rise was due to the strong performance of broad markets and AMG’s new investments.

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