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What Led to Invesco’s Discounted Valuations?

Raymond Anderson - Author

Nov. 20 2020, Updated 4:46 p.m. ET

Price-to-book ratio

Invesco Limited’s (IVZ) price-to-book ratio is ~1.3x on an NTM (next-12-months) basis. The average price-to-book ratio of the company’s competitors is ~4.1x. So, Invesco has discounted valuations. 

Among Invesco’s competitors, Lazard Limited (LAZ), Wisdom Tree Investments (WETF), and BlackRock (BLK) have price-to-book ratios on an NTM basis of ~4.5x, ~5.6x, and ~2.4x, respectively.

Invesco saw a decline in its February 2018 total AUM compared to January 2018, which could be the main reason for its lower valuations. Moving forward, the company’s 1Q18 results are also expected to experience a negative impact due to the market’s weaker performance. 

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The decline in the tech sector

Asset managers (XLF) are expected to see a hit in their results for the March 2018 quarter, primarily due to substantial downward momentum witnessed in the technology sector. These asset managers can also be impacted by higher valuations, which reduce the scope of making deployments. However, outflows could impact Invesco’s 1Q18 results, which could further pressure its valuations.

Invesco has a price-to-book ratio of ~1.4x on an LTM (last-12-months) basis. Its peers Lazard Limited (LAZ), WisdomTree Investments (WETF), and BlackRock (BLK) have price-to-book ratios of ~5.2x, ~6.3x, and ~2.6x, respectively, on an LTM basis.

Check out all the data we have added to our quote pages. Now you can get a valuation snapshot, earnings and revenue estimates, and historical data as well as dividend info. Take a look here!


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