On Thursday, TD Cowen maintained a Buy rating on Invesco (NYSE:IVZ), with a steady price target of $19.00. The stance came after Invesco reported its assets under management (AUM) as of August 31, which presented a combination of positive and less favorable developments.
The firm acknowledged Invesco's achievement of another month with positive long-term (LT) flow, noting that the LT AUM exceeded their model's expectations. The results were anticipated to be among the best in its class as more data becomes available.
Despite these positive LT flow results, there was a noted shift in the underlying mix towards lower fee-generating investment vehicles. This mix shift could potentially impact the company's fee revenue. TD Cowen projected that Invesco's shares would experience mixed trading on the day of the announcement.
The analyst's remarks followed Invesco's market update after the close on Wednesday, September 11. The update highlighted the company's financial status and performance at the end of August. The mixed nature of the AUM report reflects the dual aspects of growth in LT AUM and the ongoing transition within the investment products offered by Invesco.
TD Cowen's reiteration of the Buy rating indicates a continued positive outlook for Invesco despite the mixed AUM report. The firm expects that the strong LT flow performance may offset concerns about the shift towards lower fee products in the short term.
In other recent news, Invesco Ltd. reported an increase in its assets under management (AUM) to $1.75 trillion as of August 2024, marking a 1.1% rise from the previous month.
This growth was driven by net long-term inflows of $2.4 billion and favorable market returns, which contributed an additional $16 billion. Analyst firms Barclays (LON:BARC), RBC Capital Markets, BofA Securities, and Argus have updated their outlook on Invesco, with various price targets and ratings reflecting the company's recent financial performance.
Invesco's financial strategy includes plans to resume share buybacks and expand its ETF and fixed-income offerings, particularly in international markets such as China and Japan. This strategy has been positively received, as evidenced by a 12% year-over-year increase in AUM and an operating margin expansion to 30.9%.
Citi reiterated a Neutral rating on Invesco shares, citing promising momentum in the Asia-Pacific region. The company's AUM for July 2024 also rose by 0.9% to $1.732 trillion, with net long-term inflows totaling $10.8 billion.
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