Federated Investors Inc. Earnings: Profit Sees Increase after Four Straight Quarters of Decline

S&P 500 (NYSE:SPY) component Federated Investors Inc. (NYSE:FII) reported net income above Wall Street’s expectations for the first quarter. Federated Investors provides investment management products and related financial services, including money market, equity and fixed-income investments.

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Federated Investors Earnings Cheat Sheet for the First Quarter

Results: Net income for Federated Investors Inc. rose to $42.3 million (41 cents per share) vs. $33.2 million (32 cents per share) in the same quarter a year earlier. This marks a rise of 27.4% from the year-earlier quarter.

Revenue: Fell 3.6% to $230.3 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Federated Investors Inc. beat the mean analyst estimate of 39 cents per share. It beat the average revenue estimate of $222.2 million.

Quoting Management: “Investors’ growing demand for income and Federated’s broad array of high-quality income-oriented products continued to prove beneficial for our company during the first quarter,” said J. Christopher Donahue, president and chief executive officer. “Equity assets increased eight percent over the past 12 months driven by substantial inflows into our dividend-driven Strategic Value lineup. Our fixed-income assets increased 11 percent over the same period amid continued investor interest in our high yield-oriented and multisector bond offerings.”

Key Stats:

The company reported a profit increase last quarter, breaking a four-quarter stretch of year-over-year profit losses. In the fourth quarter of the last fiscal year, net income fell 20.4% from the year earlier, while the figure fell 11% in the third quarter of the last fiscal year, 11% in the second quarter of the last fiscal year and 20.9% in the first quarter of the last fiscal year.

The company topped expectations last quarter after falling short of forecasts in the fourth quarter of the last fiscal year with net income of 36 cents versus a mean estimate of net income of 39 cents per share.

Looking Forward: Analysts appear increasingly optimistic about the company’s results for the next quarter. The average estimate for the second quarter has moved up from 39 cents a share to 40 cents over the last sixty days. For the fiscal year, the average estimate has moved up from $1.59 a share to $1.65 over the last sixty days.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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