Let’s dig into the relative performance of StepStone Group (NASDAQ: STEP) and its peers as we unravel the now-completed Q2 custody bank earnings season.
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 15 custody bank stocks we track reported a mixed Q2. As a group, revenues were in line with analysts’ consensus estimates.
In light of this news, share prices of the companies have held steady as they are up 1.2% on average since the latest earnings results.
StepStone Group (NASDAQ: STEP)
Operating as both an advisor and asset manager with over $100 billion in assets under management, StepStone Group (NASDAQ: STEP) is an investment firm that provides clients with access to private market investments across private equity, real estate, private debt, and infrastructure.
StepStone Group reported revenues of $237.5 million, up 27.4% year on year. This print fell short of analysts’ expectations by 1.1%. Overall, it was a slower quarter for the company with a significant miss of analysts’ AUM and EPS estimates.
StepStone Group achieved the fastest revenue growth of the whole group. Unsurprisingly, the stock is up 10.1% since reporting and currently trades at $63.40.
Is now the time to buy StepStone Group? Access our full analysis of the earnings results 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 a solid beat of analysts’ AUM estimates and a beat of analysts’ EPS estimates.
Voya Financial achieved the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 6.1% since reporting. It currently trades at $72.
Is now the time to buy Voya Financial? Access our full analysis of the earnings results here, it’s free.
Slowest Q2: 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. As expected, the stock is down 5.7% since the results and currently trades at $22.60.
Read our full analysis of Franklin Resources’s results here.
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 print was in line with analysts’ expectations. Zooming out, it was a mixed quarter as it also logged a narrow beat of analysts’ EPS estimates but a slight miss of analysts’ Asset Management segment estimates.
The stock is down 9.3% since reporting and currently trades at $486.60.
Read our full, actionable report on Ameriprise Financial here, it’s free.
SEI Investments (NASDAQ: SEIC)
Founded in 1968 as Simulated Environments Inc. to train bank loan officers using computer simulations, SEI Investments (NASDAQ: SEIC) provides technology platforms, investment management, and operational solutions for financial institutions, wealth managers, and investors.
SEI Investments reported revenues of $559.6 million, up 7.8% year on year. This result came in 0.7% below analysts' expectations. In spite of that, it was a very strong quarter as it put up a beat of analysts’ EPS estimates.
The stock is down 6.7% since reporting and currently trades at $84.
Read our full, actionable report on SEI Investments here, it’s free.
Market Update
Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.
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