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Affiliated Managers (AMG) to Post Q3 Earnings: What's in Store?

Affiliated Managers Group Inc. AMG is scheduled to announce third-quarter 2021 results on Nov 1, before the opening bell. Its earnings and revenues are expected to have increased on a year-over-year basis.

In the last reported quarter, the company’s earnings beat the Zacks Consensus Estimate. Results benefited from an improvement in revenues, growth in assets under management balance, and lower expenses.

The company boasts an impressive earnings surprise history. Its earnings surpassed the consensus estimate in each of the trailing four quarters, the average beat being 8.36%.


Earnings & Revenue Projections for Q3

The Zacks Consensus Estimate for third-quarter earnings of $3.93 has been revised almost 1% upward over the past 30 days. Also, the figure indicates a rise of 20.2% from the year-ago quarter’s reported figure.

The consensus estimate for revenues is pegged at $599.7 million, indicating 21.2% growth.

Key Management Q3 Expectations

Adjusted EBITDA is projected to be in the range of $215-$220 million based on the present AUM level.

Interest expenses are expected to be $28 million, suggesting a 3.7% sequential rise. Further, controlling interest depreciation is expected to remain at the second-quarter 2021 level of $2 million.

The company’s share of reported amortization and impairments is expected to be in line with the second-quarter level of $36 million. Intangible related deferred taxes are projected to be $12 million, down 61.3% from the prior quarter.

Other economic items (excluding any mark-to-market impact) are anticipated to be $1 million.

Adjusted weighted average share count is estimated to be $42.1 million.

Major Investments in Q3

In September, Affiliated Managers announced a deal to acquire a majority equity stake in Abacus Capital Group LLC, a leading privately owned real estate investment manager. The financial terms of the deal, which is expected to be closed in the fourth quarter, are not disclosed yet. The deal, the first one for the company in real estate investing, is expected to strengthen its participation in private markets.

Additionally, in July, Affiliated Managers had announced a deal to acquire a majority equity stake in Parnassus Investments, one of the largest sustainable investment fund managers in the United States. This transaction was subsequently closed in early October. At the time of the announcement, the company had projected the deal to contribute nearly $15 million to EBITDA (net of one-time transaction costs) in the fourth quarter of 2021 and $70 million to adjusted EBITDA as well as $1.30 to economic earnings per share next year.

Earnings Whispers

According to our quantitative model, the chances of Affiliated Managers beating the Zacks Consensus Estimate this time are high. This is because it has the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or higher.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Earnings ESP: The Earnings ESP for Affiliated Managers is +0.34%.

Zacks Rank: The company currently carries a Zacks Rank #3.

Other Stocks to Consider

Here are a few other finance stocks that you may want to consider as these have the right combination of elements to post an earnings beat in their upcoming releases, per our model.

KKR & Co. Inc. KKR is scheduled to release earnings on Nov 2. The company currently carries a Zacks Rank #2 (Buy) and has an Earnings ESP of +1.34%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Earnings ESP for Fidelity National Information Services, Inc. FIS is +0.02% and it carries a Zacks Rank #3 at present. The company is slated to report quarterly numbers on Nov 4.

Main Street Capital Corporation MAIN is also scheduled to release earnings on Nov 4. The company, which carries a Zacks Rank #2 at present, has an Earnings ESP of +1.59%.

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