3 Financial Stocks Drive Selling Activity After Earnings
T. Rowe Price Group Inc. (NASDAQ:TROW) reported its results for the fourth quarter. Net income for the financial services company fell to $188.4 million (73 cents per share) vs. $191.6 million (72 cents per share) a year earlier. This is a decline of 1.7% from the year earlier quarter. TROW beat the mean analyst estimate of 69 cents per share. Analysts were expecting revenue of $658.3 million.
James A.C. Kennedy, the company’s chief executive officer and president, commented: “With markets facing substantial headwinds, 2011 was an unusually volatile year that tested the patience of investors around the world. The eurozone’s sovereign debt problems, lack of political leadership in both Washington and Europe, and concerns about a global economic slowdown led to losses in most global equity markets. Despite the tumult, a fragile U.S. economic recovery continued to gain traction, bond investors came through in relatively good shape, and investors in U.S. large-cap companies had small gains.”
Competitors to Watch: Federated Investors, Inc. (NYSE:FII), BlackRock, Inc. (NYSE:BLK), Waddell & Reed Financial, Inc. (NYSE:WDR), U.S. Global Investors, Inc. (NASDAQ:GROW), Janus Capital Group Inc. (NYSE:JNS), Franklin Resources, Inc. (NYSE:BEN), Virtus Investment Partners, Inc. (NASDAQ:VRTS), Cohen & Steers, Inc. (NYSE:CNS), Calamos Asset Management, Inc (NASDAQ:CLMS), and Financial Engines Inc (NASDAQ:FNGN).
Legg Mason Inc. (NYSE:LM) posted lower net income in the third quarter compared with a year-earlier period. Net income for the asset management company fell to $28.1 million (20 cents per share) vs. $61.6 million (41 cents per share) a year earlier. This is a decline of 54.4% from the year earlier quarter. Revenue fell 13.1% to $627 million from the year earlier quarter. LM reported adjusted net income of 55 cents per share. By that measure, the company beat the mean estimate of 27 cents per share. It fell short of the average revenue estimate of $655.7 million.
Mark R. Fetting, Chairman and CEO of Legg Mason said, “It was a challenging quarter, with the cumulative effect of 2011′s second-half market turmoil impacting AUM and revenues. However, our core business held up well, the flow picture improved and investment performance remained strong. More generally, we enter calendar year 2012 having made significant strategic progress relative to long-term earnings per share growth. The streamlining efforts announced in May of 2010 have positioned us to realize $140 million in run rate savings starting in the fiscal 4th quarter, and our balance sheet increasingly affords us the opportunity to invest in organic growth, while thoughtfully returning capital to our shareholders. Ultimately, despite short term market movements, we remain confident in our prospects and intend to capitalize on opportunities that arise in the markets where our affiliates invest.”
Competitors to Watch: AllianceBernstein Holding LP (NYSE:AB), Westwood Hldgs. Group, Inc. (NYSE:WHG), Diamond Hill Investment Group, Inc. (NASDAQ:DHIL), Epoch Holding Corp (NASDAQ:EPHC), Morgan Stanley (NYSE:MS), Pzena Investment Management, Inc. (NYSE:PZN), Artio Global Investors Inc. (NYSE:ART), Sanders Morris Harris Group (NASDAQ:SMHG), The Blackstone Group L.P. (NYSE:BX), and Affiliated Managers Group, Inc. (NYSE:AMG).
West Coast Bancorp (NASDAQ:WCBO) reported its results for the second quarter. Net income for the Pacific regional bank rose to $17.8 million (83 cents per share) vs. $1.9 million (9 cents per share) in the same quarter a year earlier. This marks a substantial increase from the year earlier quarter. Revenue noninterest income was $6.4 million last quarter. WCBO fell short of the mean analyst estimate of $1.03 per share.
“Net income of $33.8 million for the year ended December 31, 2011, compared to $3.2 million for the same period a year ago, reflects the consistent improvement in the core operating performance of the Company over the past two years and the impact of the reversal of the deferred tax asset valuation allowance”, said Robert D. Sznewajs, President and Chief Executive Officer. “The Company’s return on average assets continues to improve, reaching 1.37% for the year ended December 31, 2011. The combination of record levels of capital, actions taken in 2011 relating to the restructuring of FHLB borrowings, implementation of cost reduction and revenue enhancing initiatives, and other measures, positions the Bank well for 2012.”
Competitors to Watch: Cascade Bancorp (NASDAQ:CACB), Pacific Continental Corp. (NASDAQ:PCBK), Wells Fargo & Company (NYSE:WFC), Bank of America Corp. (NYSE:BAC), JPMorgan Chase & Co. (NYSE:JPM), U.S. Bancorp (NYSE:USB), Columbia Banking System, Inc. (NASDAQ:COLB), and Frontier Financial Corp. (FTBK).