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Goldman Sachs maintains 'sell' rating on T. Rowe Price with $113 target

Published 2024-06-12, 03:34 p/m
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On Wednesday, Goldman Sachs (NYSE:GS) reiterated its Sell rating on shares of T. Rowe Price Group, Inc. (NASDAQ:TROW), with a steady price target of $113.00. The firm's analysis followed T. Rowe Price's report of its May-ending assets under management (AUM), which showed an increase to approximately $1,542 billion, a 3.8% rise from April's $1,485 billion. The Target (NYSE:TGT) Date AUM also saw growth, reaching $447 billion, a 3.5% increase from the previous month's $432 billion.

According to the report, after accounting for market performance and client transfers, T. Rowe Price experienced firm-wide inflows of $6.7 billion in May, translating to an annualized organic growth rate of 5.4%. Additionally, a significant institutional win within the fixed income sector was highlighted. The inflows for the month were primarily attributed to the company's Fixed Income and Multi-Asset franchises, which saw inflows of approximately $9.3 billion and $4.3 billion, respectively. However, these were partially offset by outflows from the Equity Franchise, which experienced $6.7 billion in outflows, and the Alternatives category with outflows of $0.2 billion.

The report also noted that the Target Date funds continued to attract positive inflows, albeit at a softer level than in previous months. These funds garnered $0.3 billion in inflows, estimated to represent an organic growth rate of 0.8%. Despite the positive inflows in certain segments, the Sell rating by Goldman Sachs remains unchanged, with the price target firmly set at $113.00.

In other recent news, T. Rowe Price has seen significant developments in its financial performance and market ratings. The company reported an increase in May's long-term net inflows, totaling $6.7 billion, despite quarter-to-date outflows. This increment has led to T. Rowe Price's assets under management (AUM) reaching $1.54 trillion in May, with a notable contribution from substantial institutional fixed income investments.

Keefe, Bruyette & Woods maintained a Market Perform rating on T. Rowe Price, observing an improvement in the second quarter's outflows compared to their previous forecast. Similarly, Evercore ISI maintained its "In Line" rating for the company, albeit with a revised stock price target of $107.00, down from $110.00.

The first quarter of 2024 showed robust results for T. Rowe Price, with earnings per share rising by 40% to $2.38 and AUM increasing by 15% to $1.54 trillion. Despite net outflows of $8 billion, the firm's AUM and earnings showed notable growth. Evercore ISI's projections show a decrease in outflows from $82 billion in 2023 to $38 billion in 2024, followed by a reduction to $13 billion in 2025. These are the recent developments for T. Rowe Price.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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