SEI Investments Q2 Earnings Beat as Revenues & AUM Rise

SEI Investments Co.'s SEIC second-quarter 2024 earnings of $1.05 per share surpassed the Zacks Consensus Estimate by a penny. The bottom line reflected a rise of 18% from the prior-year quarter's level.

Results benefited from higher revenues and an increase in the assets under management balance. Higher expenses acted as a headwind.

Net income was $139.1 million, up 17% from the year-ago quarter's level. Our estimate for the metric was $129.4 million.

Revenues & AUM Improve, Expenses Rise

Total revenues were $519 million, up 6% year over year. The rise was driven by higher asset management, administration and distribution fees. However, the top line missed the Zacks Consensus Estimate of $524 million.

Total expenses were $382.5 million, up 2% year over year. The increase was due to higher compensation, benefits and other personnel costs, stock-based compensation expenses, amortization costs, and data processing and computer-related costs. Our estimate for the metric was $399.6 million.

Operating income increased 21% year over year to $136.5 million. Our estimate for the metric was $119.9 million.

As of Jun 30, 2024, AUM was $470.5 billion, reflecting a rise of 13% from the prior-year quarter's reported actuals. Client assets under administration (AUA) were $1 trillion, up 16% year over year. Client AUA did not include $8.5 billion related to Funds of Funds assets reported as of Jun 30, 2024.

Share Repurchase Update

In the reported quarter, SEI Investments bought back 1.6 million shares for $111.2 million.

Conclusion

Elevated expenses are expected to hurt the company's bottom line. SEIC's increased exposure to fee-based revenues is another major concern. However, its robust AUM balance, global presence and diverse range of product offerings are expected to continue to drive growth.

Performance of Other Asset Managers

BlackRock, Inc.'s BLK second-quarter 2024 adjusted earnings of $10.36 per share handily surpassed the Zacks Consensus Estimate of $9.96. The figure reflects a rise of 12% from the year-ago quarter's level.

BLK's results benefited from a rise in revenues. AUM witnessed a solid improvement, driven by net inflows and market appreciation. However, higher expenses and a fall in non-operating income acted as headwinds for BLK.

Blackstone's second-quarter 2024 distributable earnings of 96 cents per share lagged the Zacks Consensus Estimate of 99 cents. The figure declined 3.2% from the prior-year quarter's figure.

BX's results were primarily hurt by an increase in GAAP expenses. Nevertheless, a rise in segment revenues and an improvement in the AUM balance were tailwinds.

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