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T. Rowe Price Group's Second Quarter Earnings Report
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T. Rowe Price Group (Nasdaq:TROW) announced its results for the most recent quarter on July 25, 2012. T. Rowe Price, a financial services holding company, provides investment advisory services to individual and institutional investors in the sponsored mutual funds and other investment portfolios.
Earnings are perhaps the single most studied number in a company's financial statements because they show a company's profitability. SEE: 5 Tricks Companies Use During Earnings Season
The Numbers: T. Rowe Price Group missed estimates with 79 cents per share and revenues of $736.8 million. Analysts were expecting 80 cents per share and revenues of $760.4 million. EPS rose 3.9% while revenue climbed 2.4% from the same period last year. T. Rowe Price Group's revenue rose last quarter after falling 46.4% to $733.8 million in the first quarter. For the second quarter, the company reported net income of $206.8 million, up 1% from the year-ago quarter.
Management Quote: James A.C. Kennedy, the company's chief executive officer and president, commented, "Early in 2012, evidence supported the view that the U.S. economy was beginning to gain self-sustaining momentum, the Chinese economic slow down would likely be limited, and the European debt crisis was starting to be addressed. In contrast, more recent news has called all three of these trends into question. There is now rising concern about how long it might take to decide upon and implement a long-term solution in Europe. There is also considerable doubt about the willingness of politicians on this side of the Atlantic to rise above politics, especially in an election year, to make the decisions needed to address U.S. fiscal issues. The renewed political and economic uncertainties have led to another round of retrenchment by consumers and corporations around the globe, as well as by investors."
A Look Back: Net income has increased 7.9% year-over-year on average across the last five quarters. The biggest gain came in the second quarter of the last fiscal year, when income climbed 29.1% from the year-earlier quarter.
Looking Ahead: The outlook for the company's results in the upcoming quarter is unfavorable. The average estimate for the third quarter is 84 cents per share, down from 88 cents 90 days ago. A decreasing earning estimate is a negative sign and usually leads to a drop in the stock price. The average estimate for the fiscal year is $3.27 per share, down from $3.39 90 days ago.
Earnings are perhaps the single most studied number in a company's financial statements because they show a company's profitability. SEE: 5 Tricks Companies Use During Earnings Season
The Numbers: T. Rowe Price Group missed estimates with 79 cents per share and revenues of $736.8 million. Analysts were expecting 80 cents per share and revenues of $760.4 million. EPS rose 3.9% while revenue climbed 2.4% from the same period last year. T. Rowe Price Group's revenue rose last quarter after falling 46.4% to $733.8 million in the first quarter. For the second quarter, the company reported net income of $206.8 million, up 1% from the year-ago quarter.
Management Quote: James A.C. Kennedy, the company's chief executive officer and president, commented, "Early in 2012, evidence supported the view that the U.S. economy was beginning to gain self-sustaining momentum, the Chinese economic slow down would likely be limited, and the European debt crisis was starting to be addressed. In contrast, more recent news has called all three of these trends into question. There is now rising concern about how long it might take to decide upon and implement a long-term solution in Europe. There is also considerable doubt about the willingness of politicians on this side of the Atlantic to rise above politics, especially in an election year, to make the decisions needed to address U.S. fiscal issues. The renewed political and economic uncertainties have led to another round of retrenchment by consumers and corporations around the globe, as well as by investors."
A Look Back: Net income has increased 7.9% year-over-year on average across the last five quarters. The biggest gain came in the second quarter of the last fiscal year, when income climbed 29.1% from the year-earlier quarter.
Looking Ahead: The outlook for the company's results in the upcoming quarter is unfavorable. The average estimate for the third quarter is 84 cents per share, down from 88 cents 90 days ago. A decreasing earning estimate is a negative sign and usually leads to a drop in the stock price. The average estimate for the fiscal year is $3.27 per share, down from $3.39 90 days ago.
by
Investopedia Staff
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