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Baltimore, Maryland-based T. Rowe Price Group, Inc. (TROW), founded in 1937, is a global investment manager that caters to individuals, institutions, and retirement plans. Specializing in equity and fixed-income mutual funds, it blends fundamental and quantitative analysis with a bottom-up approach.
The firm focuses on socially responsible investing, emphasizing environmental, social, and governance issues. With a history of venture capital investments and a wide global presence, T. Rowe Price continues to adapt to market shifts while delivering solid, sustainable returns.
Valued at a market cap of $26.6 billion, shares of T. Rowe Price have surged 22.6% over the past 52 weeks and 11.3% on a YTD basis, trailing behind the broader S&P 500 Index’s ($SPX) 31% gain over the past year and 25.2% return in 2024.
Narrowing the focus, TROW stock has also lagged behind the iShares U.S. Financial Services ETF (IYG). The exchange-traded fund has gained about 49.1% over the past year and 36.4% on a YTD basis.
T. Rowe Price is holding steady in 2024, delivering a solid dividend and staying in the green, but it’s trailing both peers and the S&P 500. Active management’s battle with the rise of low-cost ETFs has led to 13 quarters of net outflows, spotlighting challenges for the asset manager. Still, T. Rowe’s annuity-like business model, no long-term debt on its balance sheet, and a strategic pivot toward trending products keep it resilient. With a solid 38-year dividend streak and an impressive 4.14% yield, T. Rowe Price continues to attract investors, offering stability even as it navigates changing market tides.
For the current fiscal year, ending in December, analysts expect T. Rowe Price’s EPS to jump 22.9% year over year to $9.33. The company’s earnings surprise history is solid. It beat the consensus estimate in each of the last four quarters.
Among the 14 analysts covering TROW stock, the consensus is a “Moderate Sell.” That’s based on eight “Hold” ratings, one “Moderate Sell,” and five “Strong Sells,” – signaling that the stock has some skeptics in the mix.
The configuration has been consistent over the past few months.
On Nov. 11, Deutsche Bank (DB) revised its outlook on TROW, raising the price target to $120 while maintaining a “Hold” rating. The update reflected shifting macro assumptions post-U.S. elections, anticipating stronger capital markets activity fueled by fiscal stimulus and stable equity growth. However, inflation risks from policies like tariffs may temper interest rate cuts and push long-term bond yields slightly higher. This nuanced backdrop shaped the bank’s balanced stance on the stock.
Although the stock currently trades at a premium to the mean price target of $112.07, the Street-high target price of $129, set by Morgan Stanley (MS) analyst Michael Cyprys earlier this month, suggests the stock could rally as much as 7.6%.
