T. Rowe Price Group (NASDAQ:TROW) Shares Gap Down Following Weak Earnings

T. Rowe Price Group, Inc. (NASDAQ:TROW)’s share price gapped down before the market opened on Wednesday following a dissappointing earnings announcement. The stock had previously closed at $102.66, but opened at $97.85. T. Rowe Price Group shares last traded at $96.6690, with a volume of 2,174,360 shares trading hands.

The asset manager reported $2.44 earnings per share for the quarter, missing analysts’ consensus estimates of $2.46 by ($0.02). The firm had revenue of $1.93 billion for the quarter, compared to the consensus estimate of $1.92 billion. T. Rowe Price Group had a net margin of 28.89% and a return on equity of 19.95%. The firm’s revenue for the quarter was up 6.0% compared to the same quarter last year. During the same quarter in the prior year, the business posted $2.12 earnings per share.

Key Headlines Impacting T. Rowe Price Group

Here are the key news stories impacting T. Rowe Price Group this week:

• Positive Sentiment: Assets under management and revenue grew year-over-year and advisory fee revenue provided support, showing continued scale in the business. T. Rowe Price Q4 Highlights
• Positive Sentiment: Product expansion: the firm launched an actively managed Innovation Leaders ETF, which can help distribution and fee growth over time. ETF Launch
• Neutral Sentiment: Management released the press materials, slide deck and full earnings call/transcript — useful for investors who want detail on fund flows, expense timing and outlook. Press Release / Slide Deck Earnings Call Transcript
• Negative Sentiment: Quarterly EPS missed consensus (reported $2.44 vs. ~ $2.46 est.), driven by higher operating expenses that compressed the beat/miss buffer. That miss is the primary near-term catalyst for the selloff. Earnings Breakdown
• Negative Sentiment: Reports and commentary pointed to net outflows in the quarter — a red flag for fee-based asset managers because persistent outflows pressure revenue and margins. Net Outflows Coverage
• Negative Sentiment: Analyst reaction: Morgan Stanley trimmed its price target and the street has highlighted the EPS miss and rising costs — analyst moves amplify selling pressure. Analyst Note / Price Target
• Negative Sentiment: Options market activity: unusual uptick in put buying suggests some traders are positioning for further downside in the near term. (internal market note)

Analyst Upgrades and Downgrades

Several analysts have commented on the company. Weiss Ratings reiterated a “hold (c+)” rating on shares of T. Rowe Price Group in a research note on Monday, December 29th. Evercore ISI increased their price objective on T. Rowe Price Group from $115.00 to $116.00 in a research report on Monday, January 12th. BMO Capital Markets lifted their price objective on T. Rowe Price Group from $108.00 to $110.00 and gave the stock a “market perform” rating in a report on Tuesday, January 13th. JPMorgan Chase & Co. lowered their target price on shares of T. Rowe Price Group from $111.00 to $108.00 and set an “underweight” rating on the stock in a research note on Tuesday, January 20th. Finally, Bank of America raised their price target on shares of T. Rowe Price Group from $85.00 to $86.00 in a report on Wednesday, January 14th. Eleven investment analysts have rated the stock with a Hold rating and four have issued a Sell rating to the company. Based on data from MarketBeat.com, T. Rowe Price Group has an average rating of “Reduce” and a consensus target price of $106.92.

Insider Activity

In related news, VP Arif Husain sold 4,260 shares of the business’s stock in a transaction that occurred on Wednesday, December 10th. The shares were sold at an average price of $101.96, for a total transaction of $434,349.60. Following the completion of the sale, the vice president directly owned 47,102 shares in the company, valued at approximately $4,802,519.92. The trade was a 8.29% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which can be accessed through the SEC website. Insiders own 2.00% of the company’s stock.

Institutional Investors Weigh In On T. Rowe Price Group

A number of hedge funds have recently modified their holdings of the business. TD Waterhouse Canada Inc. raised its holdings in T. Rowe Price Group by 66.7% during the second quarter. TD Waterhouse Canada Inc. now owns 250 shares of the asset manager’s stock worth $25,000 after purchasing an additional 100 shares in the last quarter. Essex Bank grew its position in shares of T. Rowe Price Group by 3.6% in the 3rd quarter. Essex Bank now owns 2,914 shares of the asset manager’s stock valued at $299,000 after buying an additional 100 shares during the last quarter. PFG Investments LLC raised its stake in T. Rowe Price Group by 4.8% during the 3rd quarter. PFG Investments LLC now owns 2,249 shares of the asset manager’s stock worth $231,000 after acquiring an additional 102 shares in the last quarter. Bill Few Associates Inc. lifted its position in T. Rowe Price Group by 4.3% in the second quarter. Bill Few Associates Inc. now owns 2,577 shares of the asset manager’s stock valued at $249,000 after acquiring an additional 107 shares during the last quarter. Finally, GenTrust LLC boosted its stake in T. Rowe Price Group by 5.5% in the fourth quarter. GenTrust LLC now owns 2,114 shares of the asset manager’s stock valued at $216,000 after acquiring an additional 110 shares in the last quarter. Institutional investors own 73.39% of the company’s stock.

T. Rowe Price Group Price Performance

The firm’s 50 day simple moving average is $104.73 and its 200-day simple moving average is $104.61. The company has a market cap of $21.18 billion, a price-to-earnings ratio of 10.57, a P/E/G ratio of 2.49 and a beta of 1.53.

About T. Rowe Price Group

T. Rowe Price Group, Inc is a global investment management firm headquartered in Baltimore, Maryland, founded by Thomas Rowe Price Jr. in 1937. The company provides a broad range of investment products and services for individual investors, financial intermediaries, retirement plan sponsors and institutional clients. Its offerings are built around active investment management and in-house research across equity, fixed income and multi-asset strategies, reflecting a long history as a research-driven asset manager.

The firm’s product lineup includes mutual funds, separate accounts, collective investment trusts, target-date and target-risk funds, and managed account solutions, as well as services for defined contribution and defined benefit retirement plans.