What to Expect from Federated Hermes's Earnings

Federated Hermes FHI is set to give its latest quarterly earnings report on Thursday, 2024-10-24. Here's what investors need to know before the announcement.

Analysts estimate that Federated Hermes will report an earnings per share (EPS) of $0.91.

The announcement from Federated Hermes is eagerly anticipated, with investors seeking news of surpassing estimates and favorable guidance for the next quarter.

It's worth noting for new investors that guidance can be a key determinant of stock price movements.

Earnings History Snapshot

The company's EPS beat by $0.07 in the last quarter, leading to a 1.04% drop in the share price on the following day.

Here's a look at Federated Hermes's past performance and the resulting price change:

Stock Performance

Shares of Federated Hermes were trading at $38.19 as of October 22. Over the last 52-week period, shares are up 24.52%. Given that these returns are generally positive, long-term shareholders are likely bullish going into this earnings release.

Analysts' Perspectives on Federated Hermes

For investors, staying informed about market sentiments and expectations in the industry is paramount. This analysis provides an exploration of the latest insights on Federated Hermes.

A total of 5 analyst ratings have been received for Federated Hermes, with the consensus rating being Neutral. The average one-year price target stands at $36.6, suggesting a potential 4.16% downside.

Peer Ratings Comparison

The following analysis focuses on the analyst ratings and average 1-year price targets of Artisan Partners Asset, Victory Capital Holdings and StepStone Group, three prominent industry players, providing insights into their relative performance expectations and market positioning.

• As per analysts' assessments, Artisan Partners Asset is favoring an Neutral trajectory, with an average 1-year price target of $42.83, suggesting a potential 12.15% upside.
• The consensus outlook from analysts is an Neutral trajectory for Victory Capital Holdings, with an average 1-year price target of $57.64, indicating a potential 50.93% upside.
• Analysts currently favor an Neutral trajectory for StepStone Group, with an average 1-year price target of $58.12, suggesting a potential 52.19% upside.

Key Findings: Peer Analysis Summary

In the peer analysis summary, key metrics for Artisan Partners Asset, Victory Capital Holdings and StepStone Group are highlighted, providing an understanding of their respective standings within the industry and offering insights into their market positions and comparative performance.

Key Takeaway:

Federated Hermes ranks at the bottom for Revenue Growth among its peers. It is also at the bottom for Gross Profit and Return on Equity.

Discovering Federated Hermes: A Closer Look

Federated Hermes provides asset-management services for institutional and individual investors. The firm had $782.7 billion in managed assets at the end of June 2024, composed of equity (10%), multi-asset (less than 1%), fixed-income (12%), alternative (3%), and money market (75%) funds. The firm's cash-management operations are expected to generate around 50% of Federated's revenue this year, compared with 28%, 12%, and 10%, respectively, for the equity, fixed-income, and alternatives/multi-asset operations. The company's products are distributed via trust banks, wealth managers, and retail broker/dealers (64% of AUM), institutional investors (27%), and international clients (9%).

Federated Hermes: A Financial Overview

Market Capitalization: Indicating a reduced size compared to industry averages, the company's market capitalization poses unique challenges.

Revenue Growth: Federated Hermes's revenue growth over a period of 3 months has faced challenges. As of 30 June, 2024, the company experienced a revenue decline of approximately -7.07%. This indicates a decrease in the company's top-line earnings. As compared to its peers, the revenue growth lags behind its industry peers. The company achieved a growth rate lower than the average among peers in Financials sector.

Net Margin: Federated Hermes's net margin falls below industry averages, indicating challenges in achieving strong profitability. With a net margin of 4.05%, the company may face hurdles in effective cost management.

Return on Equity (ROE): Federated Hermes's ROE is below industry standards, pointing towards difficulties in efficiently utilizing equity capital. With an ROE of 1.51%, the company may encounter challenges in delivering satisfactory returns for shareholders.

Return on Assets (ROA): Federated Hermes's ROA is below industry averages, indicating potential challenges in efficiently utilizing assets. With an ROA of 0.81%, the company may face hurdles in achieving optimal financial returns.

Debt Management: The company maintains a balanced debt approach with a debt-to-equity ratio below industry norms, standing at 0.44.

To track all earnings releases for Federated Hermes visit their earnings calendar on our site.

This article was generated by Benzinga's automated content engine and reviewed by an editor.