T. Rowe Price Group, Inc. (TROW) Bundle
A Brief History of T. Rowe Price Group, Inc.
Company Overview
T. Rowe Price Group, Inc. is a global investment management firm founded in 1937. As of September 30, 2024, the company managed approximately $1.6309 trillion in assets under management (AUM), reflecting a significant increase from $1.3465 trillion at the end of 2023, representing a growth of 21.1% year-over-year.
Financial Performance
For the third quarter of 2024, T. Rowe Price reported net revenues of $1.7856 billion, up 6.9% from $1.6707 billion in the same quarter of 2023. For the nine months ended September 30, 2024, total net revenues were $5.2691 billion, a 9.4% increase over $4.8185 billion in the prior year.
| Financial Metric | Q3 2024 (in millions) | Q3 2023 (in millions) | Change (%) |
|---|---|---|---|
| Net Revenues | $1,785.6 | $1,670.7 | 6.9% |
| Total Net Revenues (YTD) | $5,269.1 | $4,818.5 | 9.4% |
| Diluted Earnings per Share | $2.64 | $1.97 | 34.0% |
| Net Income | $640.4 | $439.2 | 45.8% |
Asset Management Growth
The company's average AUM for the nine months ended September 30, 2024, was $1.5362 trillion, an increase of 13.1% compared to $1.3582 trillion for the same period in 2023. The increase in AUM was driven by strong market performance and positive net cash flows.
| Asset Class | AUM (in billions) | Change (%) |
|---|---|---|
| Equity | $832.0 | 12.2% |
| Fixed Income | $186.3 | 8.5% |
| Multi-Asset | $560.9 | 19.5% |
| Alternatives | $51.7 | 10.9% |
Operating Expenses
Operating expenses for the nine months ended September 30, 2024, were $3.5042 billion, compared to $3.2195 billion in the previous year. The increase in operating expenses was primarily due to higher compensation and related costs, which increased by 5.7% year-over-year.
| Expense Category | 2024 (in millions) | 2023 (in millions) | Change (%) |
|---|---|---|---|
| Compensation and Related Costs | $2,048.4 | $1,938.1 | 5.7% |
| Administrative, Distribution, and Servicing Fees | $444.8 | $410.3 | 8.4% |
| Technology and Facility Costs | $474.8 | $461.0 | 3.0% |
Market Position and Strategic Initiatives
T. Rowe Price has continued to innovate its investment strategies and expand its global footprint. As of September 30, 2024, about 8.6% of AUM was attributed to international clients, reflecting the firm’s commitment to global asset management.
Outlook
The firm anticipates continued growth in AUM due to favorable market trends and its strategic investment initiatives. The overall economic environment and market conditions will play a crucial role in shaping future performance.
A Who Owns T. Rowe Price Group, Inc. (TROW)
Ownership Structure
As of 2024, T. Rowe Price Group, Inc. (TROW) has a diverse ownership structure comprising institutional investors, mutual funds, and individual shareholders. The following table summarizes the major shareholders of T. Rowe Price Group, Inc. as of the latest available data in 2024.
| Shareholder Type | Number of Shares (millions) | Percentage Ownership (%) |
|---|---|---|
| Institutional Investors | 156.0 | 70.3 |
| Mutual Funds | 30.0 | 13.5 |
| Individual Shareholders | 36.0 | 16.2 |
| Other Entities | 0.1 | 0.0 |
Major Institutional Shareholders
The following table lists the top institutional shareholders of T. Rowe Price Group, Inc. as of 2024, highlighting their number of shares and percentage ownership.
| Institution | Shares Held (millions) | Percentage Ownership (%) |
|---|---|---|
| Vanguard Group, Inc. | 28.5 | 12.8 |
| BlackRock, Inc. | 25.6 | 11.6 |
| State Street Corporation | 20.2 | 9.1 |
| Fidelity Investments | 15.0 | 6.8 |
| Invesco Ltd. | 12.1 | 5.5 |
Management and Insider Ownership
Management and insiders hold a significant portion of T. Rowe Price's shares. The following table summarizes the ownership held by the company’s executives and directors.
| Name | Position | Shares Held (millions) | Percentage Ownership (%) |
|---|---|---|---|
| William J. Stromberg | CEO | 1.2 | 0.5 |
| David Oestreicher | General Counsel | 0.5 | 0.2 |
| Other Executives | Various | 2.3 | 1.0 |
Market Performance and Investor Sentiment
As of September 30, 2024, T. Rowe Price reported total net revenues of $5.269 billion, with net income attributable to T. Rowe Price Group, Inc. of $1.660 billion. The company operates with an average assets under management (AUM) of $1.589 trillion, which reflects a 14.1% increase year-over-year. The stock price has shown resilience in the market, with a diluted earnings per share (EPS) of $7.23.
Dividends and Share Repurchases
T. Rowe Price has a history of returning capital to shareholders through dividends and share buybacks. In the first nine months of 2024, the company returned $1.114 billion to shareholders, consisting of $850.7 million in dividends and $263.7 million in stock repurchases.
As of February 2024, the quarterly dividend per common share was raised to $1.24, a 1.6% increase from the previous quarter.
T. Rowe Price Group, Inc. (TROW) Mission Statement
Mission Statement Overview
T. Rowe Price Group, Inc. aims to deliver superior investment management services that help clients achieve their financial goals. The company focuses on long-term investment strategies and emphasizes a client-centric approach, ensuring that they provide high-quality investment solutions.
Financial Performance Metrics
As of September 30, 2024, T. Rowe Price reported the following key financial metrics:
| Metric | Value |
|---|---|
| Net Revenues (Q3 2024) | $1,785.6 million |
| Net Income (Q3 2024) | $640.4 million |
| Assets Under Management (AUM) | $1,630.9 billion |
| Average AUM | $1,589.5 billion |
| Earnings Per Share (Diluted) | $2.57 |
| Recurring Dividend per Share (2024) | $1.24 |
| Share Repurchases (2024) | $263.7 million |
| Total Cash Returned to Stockholders (2022-2024) | $4.5 billion |
Investment Advisory Fees
The breakdown of investment advisory fees for the third quarter of 2024 is as follows:
| Asset Class | Investment Advisory Fees (Q3 2024) |
|---|---|
| Equity | $978.5 million |
| Fixed Income | $104.1 million |
| Multi-Asset | $465.8 million |
| Alternatives | $84.5 million |
| Total | $1,632.9 million |
Client Demographics
As of September 30, 2024, the client base of T. Rowe Price is primarily U.S.-domiciled, with international clients representing approximately 8.6% of total assets under management.
Long-term Strategy and Commitment
T. Rowe Price's commitment to its mission is reflected in its focus on strategic long-term investments and maintaining strong client relationships. The company aims to continue delivering value through its rigorous investment processes and dedicated client service.
Recent Developments
In 2024, T. Rowe Price increased its quarterly dividend by 1.6%, demonstrating its commitment to returning value to shareholders. The company also engaged in significant share repurchases, further indicating its strong financial health.
| Year | Recurring Dividend | Stock Repurchases | Total Cash Returned |
|---|---|---|---|
| 2022 | $1,108.8 million | $855.3 million | $1,964.1 million |
| 2023 | $1,121.9 million | $254.3 million | $1,376.2 million |
| 2024 (9 months) | $850.7 million | $263.7 million | $1,114.4 million |
| Total | $3,081.4 million | $1,373.3 million | $4,454.7 million |
T. Rowe Price Group, Inc. continues to uphold its mission of providing superior investment management while focusing on long-term growth and client satisfaction.
How T. Rowe Price Group, Inc. (TROW) Works
Company Overview
T. Rowe Price Group, Inc. (TROW) is a global investment management firm that offers a diverse range of investment strategies to institutional and individual investors. As of September 30, 2024, T. Rowe Price managed approximately $1.63 trillion in assets under management (AUM), reflecting a robust growth trajectory.
Financial Performance
For the third quarter of 2024, T. Rowe Price reported net revenues of $1.79 billion, a 6.9% increase from $1.67 billion in the same quarter of 2023. The nine-month revenue for 2024 reached $5.27 billion, compared to $4.82 billion in 2023, marking a 9.4% increase.
| Financial Metric | Q3 2024 | Q3 2023 | 9M 2024 | 9M 2023 |
|---|---|---|---|---|
| Net Revenues (in millions) | $1,785.6 | $1,670.7 | $5,269.1 | $4,818.5 |
| Net Income (in millions) | $640.4 | $439.2 | $1,719.1 | $1,362.1 |
| Earnings Per Share (EPS) | $2.64 | $1.97 | $7.23 | $5.86 |
Revenue Streams
The firm's revenue is primarily derived from investment advisory fees, which accounted for over 90% of total revenues. In the third quarter of 2024, investment advisory fees totaled $1.63 billion, up 11.5% from $1.46 billion in Q3 2023. The breakdown of these fees includes:
| Type of Investment Advisory Fees | Q3 2024 (in millions) | Q3 2023 (in millions) |
|---|---|---|
| Equity | $978.5 | $885.0 |
| Fixed Income | $104.1 | $100.9 |
| Multi-Asset | $465.8 | $405.5 |
| Alternatives | $84.5 | $72.5 |
Assets Under Management
As of September 30, 2024, T. Rowe Price reported average AUM of $1,589.5 billion, a significant increase from $1,393.6 billion in the prior year. This growth is attributed to favorable market conditions and increased client inflows.
| Assets Under Management (AUM) Breakdown | Q3 2024 (in billions) | Q3 2023 (in billions) |
|---|---|---|
| Equity | $813.1 | $725.0 |
| Fixed Income | $183.3 | $169.0 |
| Multi-Asset | $542.3 | $453.8 |
| Alternatives | $50.8 | $45.8 |
Operating Expenses
Operating expenses for Q3 2024 were reported at $1.17 billion, up from $1.09 billion in Q3 2023, reflecting a year-over-year increase of 7.6%. For the nine months ended September 30, 2024, operating expenses totaled $3.50 billion, compared to $3.22 billion in 2023.
| Operating Expenses (in millions) | Q3 2024 | Q3 2023 | 9M 2024 | 9M 2023 |
|---|---|---|---|---|
| Total Operating Expenses | $1,172.0 | $1,089.4 | $3,504.2 | $3,219.5 |
| Compensation and Related Costs | $678.3 | $636.4 | $2,048.4 | $1,938.1 |
Cash Flow Analysis
Cash flow from operating activities for the first nine months of 2024 was $2.34 billion, an increase of $222.1 million from $2.12 billion in 2023. Investing activities resulted in net cash usage of $143.1 million in 2024, compared to $333.3 million in 2023.
| Cash Flow Summary (in millions) | 9M 2024 | 9M 2023 |
|---|---|---|
| Cash Flows from Operating Activities | $2,339.4 | $2,117.3 |
| Cash Flows from Investing Activities | ($143.1) | ($333.3) |
| Cash Flows from Financing Activities | ($1,089.4) | ($960.9) |
Dividend and Share Repurchase Activity
In February 2024, T. Rowe Price increased its quarterly dividend by 1.6% to $1.24 per share. For the first nine months of 2024, the company repurchased 2.3 million shares at an average price of $112.30, totaling $263.7 million.
| Stockholder Returns (in millions) | 2022 | 2023 | 9M 2024 |
|---|---|---|---|
| Recurring Dividend | $1,108.8 | $1,121.9 | $850.7 |
| Stock Repurchases | $855.3 | $254.3 | $263.7 |
| Total Cash Returned to Stockholders | $1,964.1 | $1,376.2 | $1,114.4 |
How T. Rowe Price Group, Inc. (TROW) Makes Money
Revenue Sources
T. Rowe Price Group, Inc. primarily generates revenue through investment advisory services, which account for more than 90% of its net revenues. The company offers a variety of investment solutions across different asset classes including equity, fixed income, multi-asset, and alternatives.
Investment Advisory Fees
For the three months ended September 30, 2024, T. Rowe Price reported total investment advisory fees of $1,632.9 million, an increase of 11.5% compared to $1,463.9 million in the same period of 2023. For the nine months ended September 30, 2024, these fees totaled $4,772.5 million, up from $4,286.5 million in 2023.
| Type of Investment | Q3 2024 Revenue (in millions) | Q3 2023 Revenue (in millions) | YTD 2024 Revenue (in millions) | YTD 2023 Revenue (in millions) |
|---|---|---|---|---|
| Equity | $978.5 | $885.0 | $2,877.0 | $2,581.2 |
| Fixed Income | $104.1 | $100.9 | $304.9 | $303.3 |
| Multi-Asset | $465.8 | $405.5 | $1,340.3 | $1,182.8 |
| Alternatives | $84.5 | $72.5 | $250.3 | $219.2 |
Administrative, Distribution, and Servicing Fees
In addition to advisory fees, T. Rowe Price earns administrative, distribution, and servicing fees. For Q3 2024, these fees amounted to $148.1 million, up 5.3% from $140.7 million in Q3 2023. Year-to-date, these fees reached $444.8 million, compared to $410.3 million in the prior year.
Capital Allocation-Based Income
Capital allocation-based income, which includes changes in accrued carried interest, contributed $4.6 million in Q3 2024 compared to $66.1 million in Q3 2023. For the nine months ended September 30, 2024, this income was $51.8 million versus $121.7 million in 2023, reflecting a decrease due to lower performance in affiliated funds.
Assets Under Management (AUM)
The company's revenue is significantly influenced by its AUM. As of September 30, 2024, the average AUM was $1,589.5 billion, an increase of 14.1% from $1,393.6 billion in 2023. The ending AUM was $1,630.9 billion, up 21.1% from $1,346.5 billion in the same period last year.
| Metric | Q3 2024 | Q3 2023 | YTD 2024 | YTD 2023 |
|---|---|---|---|---|
| Average AUM (in billions) | $1,589.5 | $1,393.6 | $1,536.2 | $1,358.2 |
| Ending AUM (in billions) | $1,630.9 | $1,346.5 | $1,630.9 | $1,346.5 |
Operating Expenses
For the third quarter of 2024, T. Rowe Price reported operating expenses of $1,172.0 million, a rise of 7.6% from $1,089.4 million in Q3 2023. Year-to-date operating expenses reached $3,504.2 million, compared to $3,219.5 million in the previous year.
Net Income and Earnings Per Share (EPS)
Net income attributable to T. Rowe Price Group, Inc. for Q3 2024 was $603.0 million, an increase of 33.1% from $453.2 million in Q3 2023. The diluted EPS for the quarter was $2.64, up from $1.97 in the same quarter of 2023. For the first nine months of 2024, net income was $1,660.2 million compared to $1,351.1 million in 2023, resulting in a diluted EPS of $7.23 versus $5.86 in the prior year.
| Metric | Q3 2024 | Q3 2023 | YTD 2024 | YTD 2023 |
|---|---|---|---|---|
| Net Income (in millions) | $603.0 | $453.2 | $1,660.2 | $1,351.1 |
| Diluted EPS | $2.64 | $1.97 | $7.23 | $5.86 |
Shareholder Returns
T. Rowe Price has also focused on returning capital to shareholders. In the first nine months of 2024, the company returned $1,114.4 million to shareholders through dividends and stock repurchases.
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Article updated on 8 Nov 2024
Resources:
- T. Rowe Price Group, Inc. (TROW) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of T. Rowe Price Group, Inc. (TROW)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View T. Rowe Price Group, Inc. (TROW)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.