Why is SEI (SEIC) up 1.9% since the last earnings report?

It’s been about a month since SEI Investments’ (SEIC) last earnings report. Shares rose about 1.9% in that time, underperforming the S&P 500.

Will the recent positive trend continue leading up to the next earnings release, or is SEI set to decline? Before we dive into how investors and analysts have reacted as of late, let’s take a quick look at the most recent earnings report in order to get a better handle on the key drivers.

SEI Investments’ first-quarter earnings soared as revenue and AUM grew

SEI Investments’ first-quarter 2024 earnings of 99 cents per share surpassed the Zacks Consensus Estimate of 97 cents. The final result reflects an increase of 25% compared to the previous year’s quarter.

The results were driven by higher revenues and an increase in the value of managed assets. Higher expenses had a dampening effect.

Net profit amounted to $131.4 million, an increase of 23% compared to the same quarter last year. Our estimate for this metric was $117.8 million.

Revenues and AUM are improving, expenses are increasing

Total revenue was $511.6 million, up 9% year-over-year. The increase was due to higher asset management fees, administrative and distribution fees, and information processing and software support fees. Additionally, the result surpassed the Zacks Consensus Estimate of $505.4 million.

Total expenses were $385.7 million, up 5% year-over-year. The increase was due to higher salaries, benefits and other personnel costs; software royalties and other information processing costs; stock-based compensation costs; depreciation costs; and data processing and computer costs. Our spending estimate was $382.7 million.

Operating income increased 24% year-over-year to $125.9 million. Our estimate for this metric was $107.1 million.

As of March 31, 2024, AUM was $443.6 billion, up 8% from the prior-year quarter. Customer assets under administration (AUA) were $983.3 billion, up 16% year-on-year. AUA Client did not include $11.0 billion related to Funds of Funds assets reported as of March 31, 2024.

Share an update on the buyback

In the reported quarter, SEI Investments repurchased 0.8 million shares for $56 million.

How have estimates changed since then?

It turns out that the fresh estimates have not changed over the last month.

VGM results

Right now, SEI has a nice B growth score, a rating with the same momentum score. Plotting a somewhat similar path, the stock received a grade of C on the value side, ranking in the middle 20% for this investment strategy.

Overall, the stock has a Total VGM Score of C. If you’re not focused on one strategy, this score should interest you.

Perspectives

SEI carries a Zacks Rank #3 (Hold). We expect a linear rate of return on the stock over the next few months.

Industry player performance

SEI is part of the Zacks Financial – Investment Management industry. Over the past month, shares of Ameriprise Financial Services (AMP) in the same industry have gained 5.7%. More than a month ago, the company published its results for the quarter ended March 2024.

In the most recent quarter, Ameriprise reported revenues of $4.1 billion, representing a year-over-year change of +10.9%. EPS of $8.39 for the same period compared to $7.25 a year ago.

Ameriprise is expected to report earnings per share of $8.55 for the current quarter, representing a year-over-year change of +14.9%. Over the past 30 days, the Zacks Consensus Estimate has moved +0.1%.

The overall direction and magnitude of estimate revisions translates into a Zacks Rank #3 (Hold) for Ameriprise. The stock also has a VGM Rating of B.

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