MutualFundWire.com: An Expanding AM Supertanker Still Had a Tough Year

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Thursday, December 26, 2019

An Expanding AM Supertanker Still Had a Tough Year

Avid Invesco [profile] watchers may want to check out the Financial Times article on how the Atlanta-based, publicly traded asset manager is faring in recent years, highlighting the good and the bad.

Martin L. Flanagan
Invesco
President and CEO

On the good side, the FT notes that nearly one-third (six out of 19) of Bloomberg-tracked analysts who are tracking Invesco expect the acquisitive mutual fund firm's stock to outperform, while one of those 19 analysts thinks its shares will fall. For the optimistic analysts, a key piece is Invesco's post-OpFunds deal cost-savings from job cuts: the firm has already trimmed about $501 million in costs, $26 million than Flanagan previously predicted publicly.

The paper also notes that Invesco had record net inflows this year into its European ETFs and had other wins in China and Europe. And thanks in part to that OpFunds deal (as well as the rising tide of favorable markets), Invesco is now part of the exclusive $1-trillion-plus-AUM club. (And 25 percent of the firm's AUM is on the ETF side of its business, up from 17 percent three years ago.)

On the bad side, Invesco has suffered an average of $1 billion per week in net outflows for the past 12 months, including $7.8 billion in November alone. Setting aside ETFs, Invesco has suffered $62 billion in net outflows since Flanagan unveiled the OpFunds deal in October 2018. (That deal closed in May 2019.)

"On the U.S. distribution side it's worse than expected — there have been more outflows than anticipated," an unnamed Invesco employee tells the FT.

The FT notes that Invesco's share price has fallen more 50 percent since the beginning of 2018. One unnamed ex-Invesco veteran worries to the FT that "Invesco is a supertanker" that is tricky to turnaround due its size.

Printed from: MFWire.com/story.asp?s=60681

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