As the Q3 earnings season wraps, let’s dig into this quarter’s best and worst performers in the asset management industry, including Blackstone (NYSE: BX) and its peers.
Asset management firms oversee investment portfolios for institutions and individuals. The industry benefits from the growing global wealth pool, retirement savings needs, and expansion into alternative investments (private equity, real estate, etc.). However, firms face significant pressure from the shift to lower-cost passive investment products, regulatory requirements for fee transparency, and increasing technology costs to stay competitive in portfolio management and client service.
The 5 asset management stocks we track reported a mixed Q3. As a group, revenues missed analysts’ consensus estimates by 2%.
Thankfully, share prices of the companies have been resilient as they are up 5.8% on average since the latest earnings results.
Best Q3: Blackstone (NYSE: BX)
With over $1 trillion in assets under management and investments spanning real estate, private equity, credit, and hedge funds, Blackstone (NYSE: BX) is a global alternative asset manager that invests capital on behalf of pension funds, sovereign wealth funds, and other institutional investors.
Blackstone reported revenues of $3.34 billion, up 36.7% year on year. This print exceeded analysts’ expectations by 6.6%. Overall, it was an exceptional quarter for the company with a beat of analysts’ EPS estimates and an impressive beat of analysts’ revenue estimates.
Blackstone achieved the biggest analyst estimates beat and fastest revenue growth of the whole group. Investor expectations, however, were likely higher than Wall Street’s published projections, leaving some wishing for even better results (analysts’ consensus estimates are those published by big banks and advisory firms, not the investors who make buy and sell decisions). The stock is down 4% since reporting and currently trades at $155.20.
Ares (NYSE: ARES)
With roots in the leveraged finance group of Apollo Management, Ares Management (NYSE: ARES) is an alternative investment firm that manages private equity, credit, real estate, and infrastructure assets for institutional and high-net-worth clients.
Ares reported revenues of $1.14 billion, up 35.7% year on year, outperforming analysts’ expectations by 2.5%. The business had a very strong quarter with a solid beat of analysts’ management fees estimates and an impressive beat of analysts’ fee-related earnings estimates.
The market seems happy with the results as the stock is up 13.6% since reporting. It currently trades at $169.
Is now the time to buy Ares? Access our full analysis of the earnings results here, it’s free for active Edge members.
Weakest Q3: Carlyle (NASDAQ: CG)
Founded in 1987 with just $5 million in capital and named after the iconic New York hotel where the founders first met, The Carlyle Group (NASDAQ: CG) is a global investment firm that raises, manages, and deploys capital across private equity, credit, and investment solutions.
Carlyle reported revenues of $782.5 million, down 12.6% year on year, falling short of analysts’ expectations by 20.7%. It was a disappointing quarter as it posted a significant miss of analysts’ revenue estimates and a significant miss of analysts’ EPS estimates.
Carlyle delivered the weakest performance against analyst estimates and slowest revenue growth in the group. Interestingly, the stock is up 6.9% since the results and currently trades at $60.47.
Read our full analysis of Carlyle’s results here.
Artisan Partners (NYSE: APAM)
Founded in 1994 with a focus on autonomous investment teams and a "high-value-added" approach, Artisan Partners (NYSE: APAM) is an investment management firm that offers actively managed equity and fixed income strategies to institutional and individual investors.
Artisan Partners reported revenues of $301.3 million, up 7.8% year on year. This print missed analysts’ expectations by 0.9%. Zooming out, it was a mixed quarter as it also recorded a beat of analysts’ EPS estimates but a slight miss of analysts’ revenue estimates.
The stock is down 5.6% since reporting and currently trades at $41.69.
Read our full, actionable report on Artisan Partners here, it’s free for active Edge members.
TPG (NASDAQ: TPG)
Founded in 1992 and managing over 300 active portfolio companies across more than 30 countries, TPG (NASDAQ: TPG) is a global alternative asset management firm that invests across private equity, credit, real estate, and public market strategies.
TPG reported revenues of $512.1 million, up 12% year on year. This result topped analysts’ expectations by 2.6%. More broadly, it was a mixed quarter as it also logged an impressive beat of analysts’ AUM estimates but a significant miss of analysts’ EPS estimates.
The stock is up 18.1% since reporting and currently trades at $64.74.
Read our full, actionable report on TPG here, it’s free for active Edge members.
Market Update
In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.
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