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T Rowe Price (TROW)
NASDAQ:TROW
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T Rowe Price
(NASDAQ:TROW)
77Outperform
Positive Factors
Partnerships
TROW announced a new insurance partnership with ARES’s insurance partner (Aspida), with TROW/OHA managing public/private credit for a portion of Aspida’s balance sheet.
Revenue
Better revenue and other items partially offset the impact of elevated expenses for T. Rowe Price Group.
Target Price
The price target for T. Rowe Price Group has been slightly increased.
Negative Factors
Earnings Estimate
Analyst is lowering the 1Q25 EPS estimate to $2.21 from $2.33.
Operating Expenses
Higher operating expenses have led to a reduction in the earnings estimate for T. Rowe Price Group.
Price Target
The price objective for T. Rowe Price Group is set at 91.00 USD, which is lower than the current price of 114.37 USD.
T Rowe Price (TROW) vs. S&P 500 (SPY)
Market Cap
$21.44B
Dividend Yield5.11%
Average Volume (3M)2.48M
Price to Earnings (P/E)11.0
Beta (1Y)1.33
Revenue Growth6.51%
EPS Growth4.52%
CountryUS
Employees8,084
SectorFinancial
Sector Strength85
IndustryAsset Management
Share Statistics
EPS (TTM)2.23
Shares Outstanding220,316,090
10 Day Avg. Volume1,959,830
30 Day Avg. Volume2,476,190
Financial Highlights & Ratios
PEG Ratio-2.78
Price to Book (P/B)1.99
Price to Sales (P/S)0.00
P/FCF Ratio15.98
Enterprise Value/Market Cap0.84
Enterprise Value/Revenue0.65
Enterprise Value/Gross Profit4.85
Enterprise Value/Ebitda1.63
Forecast
1Y Price Target
$91.36Price Target Upside-6.44% Downside
Rating ConsensusModerate Sell
Number of Analyst Covering11
T Rowe Price Business Overview & Revenue Model
Company DescriptionT. Rowe Price Group, Inc. is a publicly owned investment manager. The firm provides its services to individuals, institutional investors, retirement plans, financial intermediaries, and institutions. It launches and manages equity and fixed income mutual funds. The firm invests in the public equity and fixed income markets across the globe. It employs fundamental and quantitative analysis with a bottom-up approach. The firm utilizes in-house and external research to make its investments. It employs socially responsible investing with a focus on environmental, social, and governance issues. It makes investment in late-stage venture capital transactions and usually invests between $3 million and $5 million. The firm was previously known as T. Rowe Group, Inc. and T. Rowe Price Associates, Inc. T. Rowe Price Group, Inc. was founded in 1937 and is based in Baltimore, Maryland, with additional offices in Colorado Springs, Colorado; Owings Mills, Maryland; San Francisco, California; New York, New York; Philadelphia, Pennsylvania; Tampa, Florida; Toronto, Ontario; Hellerup, Denmark; Amsterdam, The Netherlands; Luxembourg, Grand Duchy of Luxembourg; Zurich, Switzerland; Dubai, United Arab Emirates; London, United Kingdom; Sydney, New South Wales; Hong Kong; Tokyo, Japan; Singapore; Frankfurt, Germany, Madrid, Spain, Milan, Italy, Stockholm, Sweden, Melbourne, Australia, and Amsterdam, Netherlands.
How the Company Makes MoneyT. Rowe Price generates revenue primarily through investment advisory fees, which are based on a percentage of assets under management (AUM). The company's core revenue streams include fees from mutual funds, investment advisory services for institutional clients, and subadvisory services for other financial entities. These fees are typically charged on a daily basis but are accrued and billed monthly or quarterly. T. Rowe Price also earns revenue from administrative and distribution fees related to its mutual funds. The company's earnings are influenced by factors such as market performance, net asset inflows or outflows, and the overall growth in assets under management. While T. Rowe Price does not rely heavily on significant partnerships, its reputation and performance history play a critical role in maintaining and expanding its client base.
T Rowe Price Financial Statement Overview
Summary
T Rowe Price demonstrates strong financial health across all metrics, with high profitability margins, minimal leverage, and robust cash flows. While revenue growth is modest, the company's efficient operations and financial management ensure stability and resilience. The low debt levels reduce financial risk, making the company's financial outlook positive.Income Statement
The company exhibits solid financial performance with a TTM (Trailing-Twelve-Months) gross profit margin of 64.23% and a net profit margin of 28.22%. Revenue growth is relatively flat, with a modest increase from the previous year. EBIT and EBITDA margins are strong at 32.96% and 36.76%, respectively, indicating efficient operations and robust profitability.85
Very Positive
Balance Sheet
T Rowe Price maintains a healthy balance sheet with a low debt-to-equity ratio of 0.045, reflecting minimal leverage and financial risk. The return on equity stands at a commendable 19.29%, highlighting effective use of shareholders' funds. The equity ratio is strong at 74.29%, underscoring a solid financial position and asset base.88
Very Positive
Cash Flow
The cash flow position is robust, with a TTM free cash flow growth of 1.27% and a strong operating cash flow to net income ratio of 0.87, indicating healthy cash generation. The free cash flow to net income ratio is 0.64, reflecting efficient capital expenditure management. Overall, the cash flow indicates stability and operational efficiency.82
Very Positive
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 7.11B | 7.09B | 6.46B | 6.49B | 7.67B | 6.21B | Gross Profit |
| 3.72B | 3.68B | 3.21B | 3.57B | 4.68B | 3.59B | EBIT |
| 2.34B | 2.33B | 1.99B | 2.37B | 3.71B | 2.75B | EBITDA |
| 2.71B | 2.33B | 2.52B | 3.14B | 3.91B | 2.94B | Net Income Common Stockholders |
| 2.01B | 2.10B | 1.79B | 1.56B | 3.08B | 2.37B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 2.84B | 2.65B | 2.07B | 1.76B | 1.52B | 2.15B | Total Assets |
| 13.99B | 13.47B | 12.28B | 11.64B | 12.52B | 10.66B | Total Debt |
| 472.10M | 278.70M | 397.90M | 329.60M | 249.20M | 154.10M | Net Debt |
| -2.36B | -2.37B | -1.67B | -1.43B | -1.27B | -2.00B | Total Liabilities |
| 2.46B | 2.02B | 1.99B | 1.96B | 2.26B | 1.39B | Stockholders Equity |
| 10.39B | 10.35B | 9.51B | 8.84B | 9.02B | 7.71B |
| Cash Flow | Free Cash Flow | ||||
| 1.28B | 1.26B | 911.20M | 2.12B | 3.21B | 1.70B | Operating Cash Flow |
| 1.74B | 1.69B | 1.22B | 2.36B | 3.45B | 1.92B | Investing Cash Flow |
| -190.60M | -177.50M | -527.20M | -41.50M | -1.10B | -36.30M | Financing Cash Flow |
| -1.08B | -936.60M | -1.08B | -2.08B | -2.99B | -1.49B |
T Rowe Price Technical Analysis
Neutral
97.65
Price Trends
91.10
Positive
100.36
Negative
104.66
Negative
Market Momentum
1.75
Negative
65.61
Neutral
91.67
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TROW, the sentiment is Neutral. The current price of 97.65 is above the 20-day moving average (MA) of 90.70, above the 50-day MA of 91.10, and below the 200-day MA of 104.66, indicating a neutral trend. The MACD of 1.75 indicates Negative momentum. The RSI at 65.61 is Neutral, neither overbought nor oversold. The STOCH value of 91.67 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TROW.
T Rowe Price Risk Analysis
T Rowe Price disclosed 33 risk factors in its most recent earnings report. T Rowe Price reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
T Rowe Price Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $21.44B | 11.04 | 19.47% | 5.11% | 6.51% | 4.52% | |
73 Outperform | $20.70B | 9.93 | 17.54% | 2.82% | 21.00% | 137.62% | |
70 Outperform | $16.99B | 15.89 | 20.38% | 2.98% | 62.87% | ― | |
69 Neutral | $17.84B | 25.82 | 5.84% | 2.87% | -23.47% | -67.03% | |
67 Neutral | $11.57B | 31.88 | 2.84% | 5.68% | 7.02% | -60.38% | |
65 Neutral | $27.87B | 10.97 | 11.21% | 3.04% | 15.02% | 66.71% | |
64 Neutral | $12.74B | 9.83 | 7.63% | 17000.35% | 12.34% | -5.32% |
* Financial Sector Average
Performance Comparison
TROW
T Rowe Price
98.06
-13.36
-11.99%
BEN
Franklin Resources
22.38
-0.46
-2.01%
STT
State Street
98.29
22.91
30.39%
CG
Carlyle Group
47.42
5.31
12.61%
NTRS
Northern
107.90
25.10
30.31%
CRBG
Corebridge Financial, Inc.
32.78
2.45
8.08%
T Rowe Price Earnings Call Summary
Earnings Call Date:May 02, 2025
(Q1-2025)
| % Change Since: 10.81%|
Next Earnings Date:Jul 24, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a balanced outlook with strong investment performance and international expansion being offset by earnings decline, net outflows, and challenges in alternative portfolios. The firm is making strides in ETFs and global retirement offerings, but faces market volatility and mixed results in certain areas.Q1-2025 Updates
Positive Updates
Strong Investment Performance
Over 60% of T. Rowe Price funds beat their peer groups across the one, three, five, and ten-year time periods, with equity value outperforming growth.
Leadership in Retirement Expansion
T. Rowe Price expanded its retirement offerings internationally, partnering with firms in Japan, Korea, and Canada, and being selected by a global banking institution to develop retirement-related funds.
ETFs and SMA Offerings Growth
Launched two new ETFs and broadened SMA offerings, with ETFs reaching over $12.5 billion in AUM and three ETFs surpassing $1 billion.
Recognition and Awards
Named one of Fortune Magazine's World's Most Admired Companies for the 15th consecutive year and received other industry accolades.
Consistent Dividend Increase
Quarterly dividend increased for the 39th consecutive year.
Negative Updates
Decline in Adjusted Earnings Per Share
Adjusted EPS of $2.23 for Q1 2025 decreased from $2.38 in Q1 2024.
Net Outflows
Experienced $8.6 billion in net outflows, driven largely by U.S. equities and rebalancing activity.
Challenges in Alternative Portfolios
Alternative portfolios produced mixed results, with some negative developments in certain positions and muted capital deployment in private lending funds.
Equity Market Headwinds
Equity assets under management declined from 52% to 49% of AUM in the quarter, affecting fee rates.
Company Guidance
During T. Rowe Price's First Quarter 2025 Earnings Conference Call, the company provided guidance on various performance metrics and strategic initiatives. The firm reported an improvement in investment performance, with over 60% of its funds outperforming their peer groups across one, three, five, and ten-year periods. Specifically, 61% of funds outperformed on a one-year basis, 73% on a three-year basis, 68% on a five-year basis, and 87% on a ten-year basis. The target date assets showed strong results, with 99% beating their peer groups across three, five, and ten-year periods. Fixed income performance was also solid, with 64% of funds outperforming on a one-year basis and 65% on a five-year basis. The firm highlighted strategic expansions in global retirement markets, launching a sub-advised retirement date fund series in Japan and partnering with a global banking institution for custom retirement funds in Asia, the UK, and the Middle East. T. Rowe Price also emphasized its focus on ETFs, now managing 19 funds with over $12.5 billion in assets. The company's financials showed adjusted earnings per share of $2.23, a decrease from $2.38 in the prior year, amid $8.6 billion in net outflows, primarily driven by rebalancing and U.S. equities. The balance sheet remains robust, with $3.3 billion in cash and discretionary investments, and the company continues prioritizing shareholder returns, announcing a quarterly dividend of $1.27, marking the 39th consecutive annual increase.T Rowe Price Corporate Events
Executive/Board ChangesShareholder Meetings
T. Rowe Price Stockholders Meeting Approves Key Proposals
Neutral
May 12, 2025
T. Rowe Price held its annual stockholders meeting on May 8, 2025, where several key proposals were voted on. The election of directors saw most nominees receiving strong support, while a proposal for a shareholder approval requirement for excessive golden parachutes was largely rejected. Additionally, the compensation for named executive officers was approved, and KPMG LLP was ratified as the independent registered public accounting firm for 2025.
The most recent analyst rating on (TROW) stock is a Sell with a $107.00 price target. To see the full list of analyst forecasts on T Rowe Price stock, see the TROW Stock Forecast page.
Spark’s Take on TROW Stock
According to Spark, TipRanks’ AI Analyst, TROW is a Outperform.
T Rowe Price’s strong financial performance, characterized by minimal leverage and robust profitability, is a key strength. Despite current stock price technicals suggesting mild bearish sentiment, the company’s low valuation and high dividend yield offer attractive opportunities for investors. Positive strategic moves in international markets and ETFs are promising, although offset by net outflows and earnings challenges.
To see Spark’s full report on TROW stock, click here.
Financial Disclosures
T Rowe Price to Discuss Q1 2025 Earnings
Neutral
May 2, 2025
On May 2, 2025, T Rowe Price will hold an investor conference call and webcast to discuss its earnings results for the first quarter of 2025. The company has provided supplemental materials for the earnings call, but it does not commit to updating this information, which may impact stakeholder expectations and market perceptions.
Spark’s Take on TROW Stock
According to Spark, TipRanks’ AI Analyst, TROW is a Outperform.
T Rowe Price’s overall stock score is driven by its strong financial performance and attractive valuation. The company’s solid profitability, low leverage, and effective cash management underpin its financial strength. The earnings call highlighted ongoing strategic efforts to address challenges in the market, while technical indicators suggest a cautious outlook. Despite some market difficulties, the company’s robust dividend yield and low P/E ratio provide a compelling investment case.
To see Spark’s full report on TROW stock, click here.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.