Victory Capital Holdings, Inc. (VCTR) Bundle
A Brief History of Victory Capital Holdings, Inc.
Company Overview
Victory Capital Holdings, Inc. is a diversified asset management firm that provides investment management services to institutional and retail investors. As of September 30, 2024, the firm managed assets under management (AUM) totaling $176.1 billion, an increase from $148.9 billion at the same date in 2023.
Financial Performance
For the three months ended September 30, 2024, Victory Capital reported total revenue of $225.6 million, compared to $209.7 million in the same period of 2023. For the nine months ended September 30, 2024, total revenue was $661.1 million, compared to $615.2 million for the same period in 2023.
Net Income and Earnings
Net income for the three months ended September 30, 2024, was $82.0 million, a significant increase from $52.0 million in the prior year. For the nine months ended September 30, 2024, net income rose to $211.9 million, compared to $158.0 million in 2023.
Adjusted EBITDA
Adjusted EBITDA for the three months ended September 30, 2024, was $121.3 million, representing 53.7% of revenue, compared to $107.2 million (51.1% of revenue) for the same period in 2023. For the nine months ended September 30, 2024, Adjusted EBITDA increased to $350.1 million (53.0% of revenue), up from $310.4 million (50.5% of revenue) for the same period in 2023.
Key Financial Metrics
| Metric | September 30, 2024 | September 30, 2023 |
|---|---|---|
| AUM | $176.1 billion | $148.9 billion |
| Total Revenue (3 months) | $225.6 million | $209.7 million |
| Total Revenue (9 months) | $661.1 million | $615.2 million |
| Net Income (3 months) | $82.0 million | $52.0 million |
| Net Income (9 months) | $211.9 million | $158.0 million |
| Adjusted EBITDA (3 months) | $121.3 million | $107.2 million |
| Adjusted EBITDA (9 months) | $350.1 million | $310.4 million |
Dividend Payments
Victory Capital declared dividends totaling $73.1 million for the nine months ended September 30, 2024, compared to $64.8 million for the same period in 2023. Quarterly dividends for the same periods were $72.2 million and $63.6 million, respectively.
Market Trends and Investment Flows
The company generated $6.1 billion in gross flows and experienced $2.6 billion in net outflows during the three months ended September 30, 2024, compared to $5.1 billion in gross flows and $2.0 billion in net outflows for the same period in 2023. For the nine months ended September 30, 2024, gross flows amounted to $19.4 billion, with net outflows of $5.5 billion.
Company Strategy and Future Outlook
Victory Capital focuses on strategic acquisitions and enhancing its product offerings to attract a diverse client base. The firm continues to prioritize performance-driven investment strategies that align with market demands.
The effective tax rate for the three months ended September 30, 2024, was 23.7%, compared to 21.1% for the same period in 2023. The effective tax rate for the nine-month periods was 23.0% in 2024 and 22.0% in 2023.
As of September 30, 2024, the company’s share-based compensation expense was $3.7 million, a slight decrease from $3.9 million in 2023. Shareholders approved an amendment to the 2018 Stock Incentive Plan in May 2024, increasing the number of shares authorized for issuance by 2.8 million shares.
Victory Capital's commitment to growth through strategic initiatives, maintaining a robust financial position, and adapting to market conditions positions the company for continued success in the asset management industry.
A Who Owns Victory Capital Holdings, Inc. (VCTR)
Ownership Structure
As of 2024, Victory Capital Holdings, Inc. (VCTR) has a diverse ownership structure that includes institutional investors, individual shareholders, and corporate entities. A significant portion of the company's equity is held by institutional investors.
Major Shareholders
| Shareholder | Ownership Percentage | Type of Shareholder |
|---|---|---|
| Amundi US | 26.1% | Corporate |
| BlackRock, Inc. | 10.5% | Institutional |
| The Vanguard Group, Inc. | 8.3% | Institutional |
| State Street Corporation | 6.9% | Institutional |
| Other Institutional Investors | 30.2% | Institutional |
| Individual Shareholders | 19.0% | Individual |
Institutional Ownership
As of September 30, 2024, institutional investors collectively owned approximately 66% of Victory Capital Holdings. This significant institutional ownership indicates strong confidence in the company's management and business strategy.
Recent Changes in Ownership
In July 2024, Amundi contributed all shares of Amundi US to Victory Capital, resulting in a new ownership structure where Amundi US became a wholly owned subsidiary of Victory. This transaction significantly impacted the company's equity distribution.
Share Performance
As of the latest financial reports, Victory Capital's share price has seen fluctuations influenced by market conditions and company performance. The latest closing price was approximately $25.40 per share as of September 30, 2024.
Summary of Financial Performance
| Financial Metric | Value |
|---|---|
| Total Revenue (Q3 2024) | $225.6 million |
| Net Income (Q3 2024) | $82.0 million |
| Adjusted EBITDA (Q3 2024) | $121.3 million |
| Total Assets (as of September 30, 2024) | $2.612 billion |
| Total Liabilities (as of September 30, 2024) | $1.437 billion |
| Market Capitalization (as of September 30, 2024) | $1.645 billion |
Corporate Governance
The Board of Directors is composed of members nominated by significant shareholders, including Amundi, which holds the right to nominate two board members. This structure ensures that major stakeholders have a voice in the company's strategic direction.
Victory Capital Holdings, Inc. (VCTR) Mission Statement
Victory Capital Holdings, Inc. aims to deliver superior investment management services while fostering a culture of collaboration and innovation. The company is committed to providing clients with customized investment solutions that address their unique financial needs and goals.
Assets Under Management (AUM)
As of September 30, 2024, Victory Capital reported total AUM of $176.1 billion, an increase from $148.9 billion reported a year earlier. This growth of approximately 18.3% reflects the company's ability to attract and retain client assets.
Financial Highlights
For the three months ended September 30, 2024, Victory Capital generated total revenue of $225.6 million, compared to $209.7 million for the same period in 2023. Over the nine months ended September 30, 2024, total revenue increased to $661.1 million from $615.2 million in the prior year.
Net Income Performance
The net income for the three months ended September 30, 2024, was $82.0 million, up from $52.0 million in 2023. For the nine months ended September 30, 2024, net income reached $211.9 million, compared to $158.0 million for the same period in the previous year.
Investment Performance
Victory Capital's investment strategies have shown strong performance, with 67% of fund and ETF AUM rated four or five stars by Morningstar. Notably, 46% of the strategies by AUM outperformed their respective benchmarks over a one-year period.
Key Performance Indicators
| Metric | Three Months Ended September 30, 2024 | Three Months Ended September 30, 2023 | Nine Months Ended September 30, 2024 | Nine Months Ended September 30, 2023 |
|---|---|---|---|---|
| AUM at Period End ($ in millions) | $176,113 | $148,879 | $176,113 | $148,879 |
| Average AUM ($ in millions) | $171,876 | $156,491 | $167,631 | $153,983 |
| Gross Flows ($ in millions) | $6,120 | $5,149 | $19,375 | $16,959 |
| Net Flows ($ in millions) | ($2,636) | ($2,019) | ($5,508) | ($4,595) |
| Total Revenue ($ in millions) | $225.6 | $209.7 | $661.1 | $615.2 |
| Net Income ($ in millions) | $82.0 | $52.0 | $211.9 | $158.0 |
Revenue Breakdown
The breakdown of total revenue for the three and nine months ended September 30, 2024, is as follows:
| Revenue Type | Three Months Ended September 30, 2024 ($ in thousands) | Nine Months Ended September 30, 2024 ($ in thousands) |
|---|---|---|
| Investment Management Fees | $177,809 | $520,757 |
| Fund Administration and Distribution Fees | $47,819 | $140,349 |
| Total Revenue | $225,628 | $661,106 |
Client Segmentation
As of September 30, 2024, Victory Capital's AUM by distribution channel is as follows:
| Distribution Channel | AUM ($ in millions) | % of Total AUM |
|---|---|---|
| Investor | $61,989 | 35% |
| Institutional | $43,295 | 25% |
| Retail | $70,829 | 40% |
| Total AUM | $176,113 | 100% |
Market Dynamics
Victory Capital reported a market appreciation of $10.1 billion for the three months ended September 30, 2024, despite net outflows of $2.6 billion during the same period. The company continues to navigate the challenges of market volatility while maintaining a strong client-focused approach.
How Victory Capital Holdings, Inc. (VCTR) Works
Business Model
Victory Capital Holdings, Inc. operates as an investment management firm. As of September 30, 2024, the company reported total assets under management (AUM) of $176.1 billion, up from $148.9 billion a year earlier.
Revenue Streams
The primary revenue sources for Victory Capital include:
- Investment management fees
- Fund administration and distribution fees
- Performance-based fees
For the three months ended September 30, 2024, total revenue was $225.6 million, compared to $209.7 million for the same period in 2023.
Financial Performance
Key financial metrics for Victory Capital for the three months and nine months ending September 30, 2024, are summarized in the table below:
| Metric | Three Months Ended September 30, 2024 | Three Months Ended September 30, 2023 | Nine Months Ended September 30, 2024 | Nine Months Ended September 30, 2023 |
|---|---|---|---|---|
| Total Revenue | $225.6 million | $209.7 million | $661.1 million | $615.2 million |
| Net Income | $82.0 million | $52.0 million | $211.9 million | $158.0 million |
| Adjusted EBITDA | $121.3 million | $107.2 million | $350.1 million | $310.4 million |
Investment Performance
Victory Capital's investment performance has been notable, with 43 mutual funds and ETFs receiving Morningstar ratings of four or five stars. Approximately 67% of the fund and ETF AUM were rated four or five stars overall.
Client Cash Flows
Victory Capital experienced gross flows of $6.1 billion and net outflows of $2.6 billion for the three months ended September 30, 2024. Comparatively, for the same period in 2023, gross flows were $5.1 billion with net outflows of $2.0 billion.
Market Appreciation and AUM Changes
The AUM increased significantly due to market appreciation. The breakdown is as follows:
- Market appreciation of $10.1 billion
- Net outflows of $2.6 billion
Overall, AUM increased by 4.4% from $168.7 billion at June 30, 2024.
Cash Flow Overview
For the nine months ended September 30, 2024, cash flows were as follows:
| Cash Flow Category | Amount (in thousands) |
|---|---|
| Net cash provided by operating activities | $248,168 |
| Net cash used in investing activities | ($1,583) |
| Net cash used in financing activities | ($182,010) |
Client Asset Distribution
As of September 30, 2024, the distribution of AUM by client type was as follows:
| Client Type | AUM (in millions) | Percentage of Total AUM |
|---|---|---|
| Investor | $61,989 | 35% |
| Institutional | $43,295 | 25% |
| Retail | $70,829 | 40% |
Contingent Consideration
As of September 30, 2024, the estimated fair value of contingent consideration payable to sellers was $139.6 million.
How Victory Capital Holdings, Inc. (VCTR) Makes Money
Revenue Sources
Victory Capital Holdings, Inc. primarily generates revenue through various fees related to investment management, fund administration, and distribution services. For the three months ended September 30, 2024, total revenue was $225.6 million, an increase from $209.7 million during the same period in 2023. For the nine months ended September 30, 2024, total revenue reached $661.1 million compared to $615.2 million in 2023.
Assets Under Management (AUM)
As of September 30, 2024, Victory Capital reported AUM of $176.1 billion, a significant increase from $148.9 billion a year earlier. This increase was driven by market appreciation of $10.1 billion, despite net outflows of $2.6 billion. The average AUM for the nine months ended September 30, 2024, was $167.6 billion.
| Period | AUM ($ billion) | Net Flows ($ million) | Market Appreciation ($ million) |
|---|---|---|---|
| 3 Months Ended September 30, 2024 | 176.1 | -2,636 | 10,076 |
| 9 Months Ended September 30, 2024 | 176.1 | -5,508 | 20,337 |
| 3 Months Ended September 30, 2023 | 148.9 | -2,019 | -4,755 |
| 9 Months Ended September 30, 2023 | 148.9 | -4,595 | 7,335 |
Investment Management Fees
Investment management fees are the primary source of revenue, calculated as a percentage of AUM. For the three months ended September 30, 2024, investment management fees amounted to $177.8 million, compared to $164.0 million for the same period in 2023. For the nine months ended September 30, 2024, these fees totaled $520.8 million versus $480.2 million in 2023.
Fund Administration and Distribution Fees
Victory Capital also earns revenue from fund administration and distribution fees. For the three months ended September 30, 2024, these fees totaled $47.8 million, up from $45.7 million for the same period in 2023. For the nine months ended September 30, 2024, they reached $140.3 million compared to $135.0 million in 2023.
Performance-Based Fees
Performance-based fees contribute to revenue, particularly from mutual funds and separate accounts. For the three months ended September 30, 2024, these fees were $2.0 million, compared to $1.2 million in 2023. Year-to-date, performance-based fees amounted to $6.2 million compared to $3.4 million in the previous year.
Financial Performance
Victory Capital's net income for the three months ended September 30, 2024, was $82.0 million, up from $52.0 million in the same period of 2023. For the nine months ended September 30, 2024, net income reached $211.9 million compared to $158.0 million in 2023. Adjusted EBITDA for the three months was $121.3 million, representing a margin of 53.7%, compared to $107.2 million and 51.1% in 2023.
| Period | Total Revenue ($ million) | Net Income ($ million) | Adjusted EBITDA ($ million) |
|---|---|---|---|
| 3 Months Ended September 30, 2024 | 225.6 | 82.0 | 121.3 |
| 3 Months Ended September 30, 2023 | 209.7 | 52.0 | 107.2 |
| 9 Months Ended September 30, 2024 | 661.1 | 211.9 | 350.1 |
| 9 Months Ended September 30, 2023 | 615.2 | 158.0 | 310.4 |
Cash Flow and Financing Activities
For the nine months ended September 30, 2024, net cash provided by operating activities was $248.2 million, compared to $233.2 million in 2023. Cash used in investing activities was $1.6 million, while cash used in financing activities was $182.0 million.
Victory Capital Holdings, Inc. (VCTR) DCF Excel Template
5-Year Financial Model
40+ Charts & Metrics
DCF & Multiple Valuation
Free Email Support
Updated on 16 Nov 2024
Resources:
- Victory Capital Holdings, Inc. (VCTR) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Victory Capital Holdings, Inc. (VCTR)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Victory Capital Holdings, Inc. (VCTR)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.