T. Rowe Price Faces Challenges as Earnings Miss Expectations
T. Rowe Price Group, Inc. (TROW), a prominent asset management firm, is experiencing a tough year despite its solid market presence.
With a market cap of around $24 billion, T. Rowe Price is based in Baltimore, Maryland, and focuses on investment management, retirement planning, and financial advisory services. The firm provides a diverse range of mutual funds, ETFs, and institutional investment solutions to clients all over the world.
Over the past 52 weeks, shares of T. Rowe Price have seen a slight decline, dropping 4.6% year-to-date (YTD). This performance is significantly lower than the S&P 500 Index’s impressive 22.5% gain during the same period, as well as its 4.2% return in 2025.
Continuing this trend, TROW stock has fallen behind the iShares U.S. Financial Services ETF (IYG), which has gained approximately 35.9% over the last year and 9% on a YTD basis.
On February 5, the company reported Q4 earnings that were lower than analysts had expected, leading to a 4.2% drop in its stock price. The adjusted earnings per share (EPS) were $2.12, and net revenue was $1.8 billion, both missing consensus estimates. The rise in operating expenses and a notable drop in capital allocation-based income, which turned negative at $5.2 million, negatively influenced investor sentiment. Furthermore, an outflow of $8.2 billion in cash for the quarter raised additional concerns.
Looking ahead to the current fiscal year, which ends in December 2025, analysts predict that T. Rowe Price’s EPS will slightly decline to $9.29 year-over-year. The company has a mixed earnings surprise history; it exceeded consensus estimates in three out of the last four quarters while missing in another.
Among the 14 analysts monitoring TROW stock, the consensus rating is a “Moderate Sell,” which is based on eight “Hold” ratings, one “Moderate Sell,” and five “Strong Sells.”
On February 6, TD Cowen lowered T. Rowe Price’s price target to $112, while maintaining a “Hold” rating. They noted improvements in long-term net new asset trends but expressed concerns about declining fee rates affecting revenue growth and stock performance.
As of this writing, TROW is trading below the average price target of $109.28. However, the highest street target of $126 suggests a potential upside of 16.8%.
On the date of publication, Rashmi Kumari did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are solely for informational purposes. For more details, please refer to the Barchart Disclosure Policy here.
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