Victory Capital Q3 revenue falls sequentially, missing estimates amid changes in client mix, asset-class changes

Overview

• US asset manager's Q3 revenue rose yr/yr but missed analyst expectations

• Adjusted net income for Q3 missed analyst expectations

• Company reported record client assets and net inflows for the quarter

Outlook

• Company expects First Eagle acquisition to close by end of Q1 2027

• Company focused on integration planning for First Eagle acquisition

• Company expects First Eagle deal to expand product offerings and distribution footprint

Result Drivers

• BROAD-BASED NET INFLOWS - Co said positive net flows across U.S. intermediary, institutional, and international channels, and multiple asset classes, drove record gross sales and net inflows

• INVESTMENT PERFORMANCE - Co said strong investment performance contributed to results, with a majority of AUM outperforming benchmarks over multiple periods

• REVENUE DECLINE FACTORS - Co attributed sequential revenue decline to timing of annual fee crystallization and changes in asset class and client mix

Company press release:

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 2 "strong buy" or "buy", 5 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the investment management & fund operators peer group is "buy."

• Wall Street's median 12-month price target for Victory Capital Holdings, Inc. is $119.50, about 3.2% above its November 3 closing price of $115.75

• The stock recently traded at 13 times the next 12-month earnings vs. a P/E of 13 three months ago

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)