Cohen & Steers Inc. (NYSE: CNS) has maintained its Outperform rating with a steady price target of $96.00 from Evercore ISI, reflecting a strong performance in the asset under management (AUM), which rose 4% month-over-month to $91.8 billion. This increase was attributed to a combination of market gains and significant organic growth, which reached 17.5%.
The investment management firm experienced inflows of $1.3 billion in September, a notable uptick from a $45 million outflow in July and a modest $8 million inflow in August. This performance exceeded the forecasted $0.2 billion outflow for September, marking a substantially better-than-expected result. Positive contributions came across all channels, with open-end funds leading, while sub-advisory and institutional advisory also added to the gains.
Retail flows in September surged, with a 28% flow rate, which translated to approximately $980 million. This was a stark contrast to the 5% and 1% flow rates observed in the preceding two months. The institutional side also saw improvement, with an 11% flow rate, a significant turnaround from the negative rates experienced from January to August. The institutional advisory channel itself reported inflows of $82 million, a 5% rate compared to a nearly flat performance in the previous month.
Cohen & Steers' unfunded advisory pipeline, which stood at $1 billion, is expected to support future growth. In the breakdown of institutional flows, the Japan sub-advisory sector reported $20 million in inflows, marking a second consecutive month of positive performance at a 3% rate. Additionally, the rest-of-world sub-advisory segment showed a 45% flow rate, amounting to $235 million, a recovery from a 9% decline in August.
In other recent news, Cohen & Steers, a leading investment management firm, announced a quarterly cash dividend of $0.59 per share. The firm also reported a minor decrease in earnings per share and revenue for Q2 2024, with earnings per share of $0.68 and revenue of $122 million. This change was attributed to underperformance in equity-oriented asset classes and a slight decrease in assets under management.
Lisa Dolly, former CEO of Pershing LLC, has been appointed to the Board of Directors at Cohen & Steers, a move expected to enhance the Board's depth of knowledge and expertise. The firm also disclosed leadership changes, with Raja Dakkuri taking over as CFO and Dan Noonan appointed as Head of Wealth Distribution.
In addition, Cohen & Steers has plans to launch active ETFs and has initiated the Future of Energy Fund. Several Wall Street firms, including BNY Mellon (NYSE:BK), have agreed to pay a collective sum exceeding $470 million in settlements with U.S. regulators due to violations of recordkeeping rules.
InvestingPro Insights
Cohen & Steers' recent performance aligns with several key metrics and insights from InvestingPro. The company's strong AUM growth and positive inflows are reflected in its robust financial indicators. InvestingPro data shows that CNS has a market capitalization of $4.58 billion and a P/E ratio of 36.6, indicating that investors are willing to pay a premium for its shares, likely due to its growth prospects and consistent performance.
InvestingPro Tips highlight that CNS has maintained dividend payments for 21 consecutive years, demonstrating a commitment to shareholder returns that complements its growth strategy. This is further supported by the current dividend yield of 2.6%, which may attract income-focused investors.
The company's profitability is underscored by its impressive operating income margin of 32.3% for the last twelve months, suggesting efficient management and strong pricing power in its investment products. Additionally, CNS has shown a high return over the last year, with a one-year price total return of 56.83%, outperforming many peers in the asset management sector.
These insights from InvestingPro reinforce the positive outlook presented in the article. Investors interested in a deeper analysis can access 10 additional InvestingPro Tips for CNS, providing a more comprehensive view of the company's financial health and market position.
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