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Based in Atlanta, Georgia, Invesco Ltd. (IVZ) is a publicly owned investment manager that provides its services to retail clients, institutional clients, high-net-worth clients, public entities, corporations, unions, non-profit organizations, endowments, foundations, pension funds, financial institutions, and sovereign wealth funds. The company is valued at a market cap of $7.9 billion.
Companies valued at less than $10 billion are typically classified as “mid-cap stocks,” and Invesco fits the label perfectly. The investment management company is known for its comprehensive investment capabilities and range of services, including asset management and financial advisory. It operates in over 25 countries and follows systematic, proven investment processes with a strong emphasis on risk control.
IVZ is currently trading 7.7% below its 52-week high of $18.94, reached on Nov. 6. Shares of this asset management company have marginally declined over the past three months, underperforming the broader Dow Jones Industrials Average’s ($DOWI) marginal increase during the same time frame.
Moreover, in the longer term, IVZ has declined 2% over the past 52 weeks, massively underperforming DOWI’s 13% returns. However, on a six-month basis, shares of IVZ are up 16.8%, outpacing DOWI’s 8.8% gains over the same time frame.
To confirm its recent bearish trend, Invesco has been trading below its 50-day moving average since mid-December. However, it has remained above its 200-day moving average since mid-September.
On Oct. 22, shares of IVZ marginally increased after its Q3 earnings release. The company reported a slight annual increase in adjusted revenues to $1.1 billion, which marginally missed the consensus estimates. Nevertheless, a notable improvement in adjusted operating margin led to a 25.7% year-over-year increase in adjusted EPS to $0.44 per share, which came in line with the forecasted figure.
A 20.7% annual increase in ending AUM to $1.8 trillion and strong net long-term inflows of $16.5 billion might have bolstered investor confidence. However, ongoing challenges in the Chinese market and net outflows of $6.3 billion in fundamental equity during the quarter might have partially offset the positive sentiments.
IVZ has significantly outpaced its rival, Franklin Resources, Inc. (BEN), which declined 32.5% over the past 52 weeks and 10% over six months.
Looking at Invesco’s recent underperformance, analysts remain cautious about its prospects. The stock has a consensus rating of “Hold” from the 16 analysts covering it, and the mean price target of $19.08 suggests a modest 9.1% premium to its current levels.
