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Valued at a market cap of $20.5 billion, T. Rowe Price Group, Inc. (TROW) is a global investment management firm that offers a broad suite of products, including mutual funds, sub-advisory services, separate account management, retirement solutions, and advanced investment planning tools for both individual and institutional clients. The Baltimore, Maryland-based company relies on a combination of in-house and external research to guide its investment decisions.
Companies valued at $10 billion or more are typically classified as “large-cap stocks,” and TROW fits the label perfectly, with its market cap exceeding this threshold, underscoring its size, influence, and dominance within the asset management industry. The company is known for its long-standing reputation for disciplined, research-driven active management, with a strong emphasis on fundamental analysis. A key specialty of TROW is its client-first approach, which emphasizes alignment of interests through a conservative balance sheet, debt-free operations, and a strong culture of fiduciary responsibility.
This asset management company has slipped 25.9% from its 52-week high of $125.81, reached on Dec. 6, 2024. Shares of TROW have gained marginally over the past three months, underperforming the Financial Select Sector SPDR Fund’s (XLF) 4.1% uptick during the same time frame.
In the longer term, TROW has declined 18.9% over the past 52 weeks, considerably lagging behind XLF’s 24.3% rise over the same time frame. Moreover, on a YTD basis, shares of TROW are down 17.6%, compared to XLF’s 4.6% return.
To confirm its bearish trend, TROW has been trading below its 200-day moving average since early February. However, it has remained above its 50-day moving average since early May.
On May 2, shares of TROW surged 4% after its mixed Q1 earnings release. On the downside, the company’s revenue grew marginally year-over-year to $1.8 billion but narrowly fell short of the consensus estimates. A rise in investment advisory fees was largely offset by a decline in capital allocation-based income and lower performance-based advisory fees. On the other hand, its adjusted EPS of $2.23 declined 6.3% from the year-ago quarter but outpaced the analyst expectations by 6.7%. Adding to the uptick, compared to the year-ago quarter, its average AUM advanced 9.2% to $1.6 trillion, while its ending AUM improved 1.6%, also reaching $1.6 trillion.
TROW’s underperformance looks pronounced when compared to its rival, BlackRock, Inc.’s (BLK) 27.7% gain over the past 52 weeks and 4.2% decline on a YTD basis.
Looking at TROW’s recent underperformance, analysts remain moderately bearish about its prospects. The stock has a consensus rating of "Moderate Sell” from the 14 analysts covering it. While the company is trading at its mean price target of $93.21, the Street-high price target of $104 suggests an 11.6% premium to its current price levels.
On the date of publication, Neharika Jain did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
