Our target Price of $16 implies a multiple of 9.5-times.
On July 28, Invesco reported adjusted 2Q20 EPS of $0.35, down from $0.65 in the prior-year quarter and below the consensus of $0.44. Results were hurt by a loss of $50.5 million from consolidation investment products.
EARNINGS & GROWTH ANALYSIS
Average AUM rose 6% year-over-year.
The second quarter showed $14.2 billion of net long-term outflows, mostly from actively managed products. This was a modest improvement from outflows of $19.1 billion in 1Q.
In addition to a hiring freeze, the company noted on the 1Q earnings call that its previous guidance of $755 million in quarterly operating expenses would be reduced by an additional $80 million per quarter. Still, expense cuts will not be enough to offset reduced revenues if outflows remain high.
In May 2019, Invesco acquired the Oppenheimer Funds asset management affiliate of MassMutual.