On Sep 24, 2014, we issued an updated research report on SEI Investments Co. (SEIC). This Oaks, PA-based asset management company remains focused on improving its top line. But, persistently rising expenses remains a major cause of concern.
SEI Investments reported second-quarter 2014 earnings of 48 cents per share on Jul 23, beating the Zacks Consensus Estimate by 14.3%. Also, the reported figure compared favorably with 31 cents earned in the prior-year quarter.
Results were aided by higher top-line growth, partially offset by a rise in expenses. Moreover, the company boasted a strong asset under management (AUM) and asset under administration position, mainly driven by better inflows.
SEI Investments has been witnessing strong revenue growth for the past few years. This positive trend continued in the first half of 2014 as well. Further, we believe that the company’s diversified product portfolio, along with its strong global presence, will help maintain its revenue growth momentum in the quarters ahead.
On the other hand, expenses witnessed a rising trend over the last three years which continued in the first half of 2014 as well. Growing compensation costs are primarily responsible for the expense upraise. Moreover, as the company continues to build its operational infrastructure, costs are unlikely to decrease in the near term.
Some stocks worth-considering in this space include AllianceBernstein Holding L.P. (AB), Monroe Capital Corporation (MRCC) and Janus Capital Group, Inc. (JNS).
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