As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q2. Today, we are looking at custody bank stocks, starting with Invesco (NYSE:IVZ).
Custody banks safeguard financial assets and provide services like settlement, accounting, and regulatory compliance for institutional investors. Growth opportunities stem from increasing global assets under custody, demand for data analytics, and blockchain technology adoption for settlement efficiency. Challenges include fee pressure from large clients, substantial technology investment requirements, and competition from both traditional players and fintech firms entering the space.
The 13 custody bank stocks we track reported a mixed Q2. As a group, revenues were in line with analysts’ consensus estimates.
Thankfully, share prices of the companies have been resilient as they are up 5.8% on average since the latest earnings results.
Invesco (NYSE:IVZ)
With roots dating back to 1935 when it pioneered the first mutual fund with an objective of capital growth, Invesco (NYSE:IVZ) is a global asset management firm that offers investment solutions across equities, fixed income, alternatives, and multi-asset strategies.
Invesco reported revenues of $1.10 billion, down 25.5% year on year. This print exceeded analysts’ expectations by 0.8%. Despite the top-line beat, it was still a slower quarter for the company with a significant miss of analysts’ EPS estimates and EBITDA in line with analysts’ estimates.
Invesco delivered the slowest revenue growth of the whole group. Interestingly, the stock is up 12.1% since reporting and currently trades at $22.65.
Read our full report on Invesco here, it’s free.
Best Q2: Voya Financial (NYSE:VOYA)
Originally spun off from Dutch financial giant ING in 2013 and rebranded with a name suggesting “voyage,” Voya Financial (NYSE:VOYA) provides workplace benefits and savings solutions to U.S. employers, helping their employees achieve better financial outcomes through retirement plans and insurance products.
Voya Financial reported revenues of $1.9 billion, up 2.2% year on year, outperforming analysts’ expectations by 13.5%. The business had a stunning quarter with an impressive beat of analysts’ AUM and EPS estimates.
Voya Financial scored the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 13.5% since reporting. It currently trades at $77.02.
Is now the time to buy Voya Financial? Access our full analysis of the earnings results here, it’s free.
Franklin Resources (NYSE:BEN)
Operating under the widely recognized Franklin Templeton brand since 1947, Franklin Resources (NYSE:BEN) is a global investment management organization that offers financial services and solutions to individuals, institutions, and wealth advisors worldwide.
Franklin Resources reported revenues of $1.59 billion, down 3.7% year on year, falling short of analysts’ expectations by 18.8%. It was a softer quarter as it posted a significant miss of analysts’ EPS estimates.
Franklin Resources delivered the weakest performance against analyst estimates in the group. Interestingly, the stock is up 1.8% since the results and currently trades at $24.40.
Read our full analysis of Franklin Resources’s results here.
Federated Hermes (NYSE:FHI)
With roots dating back to 1955 and a pioneering role in money market funds, Federated Hermes (NYSE:FHI) is an investment management firm that offers a wide range of funds and strategies for institutional and individual investors.
Federated Hermes reported revenues of $424.8 million, up 5.5% year on year. This print met analysts’ expectations. It was a strong quarter as it also recorded a solid beat of analysts’ EBITDA and EPS estimates.
The stock is up 6.7% since reporting and currently trades at $53.11.
Read our full, actionable report on Federated Hermes here, it’s free.
Ameriprise Financial (NYSE:AMP)
Founded in 1894 and spun off from American Express in 2005, Ameriprise Financial (NYSE:AMP) provides financial planning, wealth management, asset management, and insurance products to help individuals and institutions achieve their financial goals.
Ameriprise Financial reported revenues of $4.34 billion, up 3.9% year on year. This result was in line with analysts’ expectations. Taking a step back, it was a mixed quarter as it also recorded a narrow beat of analysts’ EPS estimates but a slight miss of analysts’ Asset Management segment estimates.
The stock is down 8.4% since reporting and currently trades at $491.39.
Read our full, actionable report on Ameriprise Financial here, it’s free.
Market Update
Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.
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