Asset managers saw stellar performance in their most recent quarterly earnings. Strong markets across different asset classes — like exchange-traded funds (ETFs), mutual funds, and private equity — along with an improving economic backdrop were key to asset managers’ solid performance in the most recent quarter and year.
Strong revenue growth was driven by solid investment performance and has boosted assets under management (AUM) at these companies significantly in the past year. Three companies posting good earnings reports in the space were BlackRock (NYSE:BLK), T. Rowe Price Group (NASDAQ:TROW), and StepStone Group (NASDAQ:STEP).
Strong earnings growth shows the strength of the economic recovery
In the most recent quarter, BlackRock saw revenue grow 32% from the same period last year to $4.8 billion, while net income was up 14% to nearly $1.4 billion. T. Rowe Price grew revenue 36% to $1.9 billion, with net income increasing 16% to $842 million. Finally, StepStone Group — which has only been publicly traded since September 2020 — saw management and advisory fees grow 23% to $78 million. This, coupled with better investment performance, helped give the company a net income of $126.5 million this year after a net loss of $51 million in the same quarter last year.
The strength of asset managers says a lot about the economic recovery, specifically the strength of asset prices thanks to easy monetary policies and fiscal stimulus spending.