A Closer Look at Ameriprise Financial’s Stellar Performance
Minneapolis, Minnesota-based Ameriprise Financial, Inc. (AMP) offers a wide range of financial products and services to both individual and institutional clients, both domestically and internationally. With a market cap of $55.5 billion, Ameriprise operates through several segments, including Advice & Wealth Management, Asset Management, Retirement & Protection Solutions, and Corporate & Other.
Significant Outperformance in the Market
Ameriprise has notably outperformed the broader market in the past year. So far this year, AMP’s stock prices have increased by 50.6%, and over the last 52 weeks, they’ve risen 63.7%. This is a sharp contrast to the S&P 500 Index’s gains of 25.8% in 2024 and 31.8% over the past year.
When focusing more closely on financial sector performance, Ameriprise has outpaced the Financial Select Sector SPDR Fund’s (XLF) increases of 36.3% in 2024 and 45.4% over the past year.
Quarterly Earnings Report Highlights
On October 23, following the release of its Q3 earnings, Ameriprise’s stock experienced a 3.1% decline. The company reported an adjusted operating EPS of $8.83, which fell short of analysts’ expectations. Despite this, Ameriprise has shown solid overall performance. With strong client net inflows and asset appreciation, its assets under management and administration surged 22.2% year-over-year, reaching $1.5 trillion.
The firm continues to generate robust revenues and earnings. Net revenues climbed over 12% year-over-year to $4.4 billion, while adjusted operating earnings increased by 11.1% year-over-year to $828 million.
Moreover, Ameriprise reported impressive free cash flow, allowing the company to manage market cycles effectively. In the recent quarter, it returned $713 million to investors through share repurchases and dividends, illustrating its dedication to enhancing shareholder value.
As for the current fiscal year ending in December, analysts anticipate a 12.5% year-over-year growth in adjusted EPS to $34.26. In the past four quarters, Ameriprise has exceeded analysts’ earnings estimates three times, though it did miss on one occasion.
Analyst Ratings and Future Projections
The consensus rating for AMP stock is “Moderate Buy.” Among the 13 analysts monitoring the stock, five recommend “Strong Buy,” one advises “Moderate Buy,” six suggest “Hold,” and one rates it a “Strong Sell.” This designation reflects a slightly less optimistic view than the prior month when six analysts had given “Strong Buy” recommendations.
On November 14, 2024, Evercore ISI analyst Thomas Gallagher raised Ameriprise’s price target to $613, while maintaining an “In-Line” rating. Gallagher cited the potential benefits of heightened interest in the life insurance sector as a significant factor.
As of this writing, AMP is trading above its mean price target of $552. The highest target on the Street sits at $653, implying a 14.2% premium compared to current price levels.
On the date of publication, Aditya Sarawgi did not hold (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are intended for informational purposes only. For more details, please refer to the Barchart Disclosure Policy here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
