Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 7 stocks made the list for top value stocks in the Investment Management & Fund Operators industry. Those looking for value stocks to add to their portfolio may want to use this list as a starting point for further investment research.

Latest Investment Management & Fund Operators Stock News

Before choosing which top Investment Management & Fund Operators stock to buy, be sure to conduct proper due diligence: analyze various financial metrics and look at historical data, public statements and news coverage.

There is a neutral fundamental outlook for the investment management and fund operators’ sub-industry. The long-term outlook is relatively healthy due to aging populations. Demographic trends are also favorable, as millennials come of age and baby boomers play “catch-up” with contributions to IRAs, driving a significant increase in retirement investments, in our view. Millennials are also maturing and beginning to save for retirement. Many companies will also benefit from legislation enacted designed to encourage saving for retirement. However, the shift from actively managed funds to ETFs and pressures on fee revenues could slightly offset this. Recent market volatility has also impacted equity funds. Firms could benefit from rising interest rates. Growth in assets under management (AUM) is a key driver for many firms in this industry. 2022 projections anticipate high-single-digit AUM growth, though near-term market volatility amid shifting sector allocations will likely keep AUM levels under pressure. At year end 2021, assets in all worldwide open-end funds totaled $71.1 trillion, up 13% from $63 trillion at year end 2020. Equity assets (which rose 19 % in 2021, to $33.6 trillion) equaled 47% of total fund assets. Bond funds (which rose 4.6% in 2021, to $13.7 trillion) accounted for 19% of total fund assets. Money market accounts (which increased by 6.0%, to $8.8 trillion) represented 12% of total assets, and other funds (including real estate and balanced funds, equaled $15.6 trillion, or 22% of total fund assets at year-end 2021. A rebound in asset values amid an economic recovery propelled the S&P Asset Management & Custody Banks Index up by 31.9% during 2021, versus a 26.7% rise in the S&P 1500 Index. Year to date through March 18, 2022, the sub-industry index declined by 13.5%, while the S&P 1500 Index declined by 6.2%.

Why Focus on Undervalued Investment Management & Fund Operators Stocks?

Value investors seek to buy stocks at a discount to their intrinsic value. Long-term returns show that such strategies are advantageous. Value stocks, as a group, tend to outperform growth stocks over extended periods of time. Typically, value investors perform financial analysis of numerous metrics, don’t follow the herd and are long-term investors.

AAII’s A+ Investor Value Grade is derived from a stock’s Value Score. The Value Score is the percentile rank of the average of the percentile ranks of the price-to-sales ratio, price-earnings ratio, enterprise-value-to-EBITDA (EV/EBITDA) ratio, shareholder yield, price-to-book-value ratio and price-to-free-cash-flow ratio. The score is variable, meaning it can consider all six ratios or, should any of the six ratios not be valid, the remaining ratios that are valid. To be assigned a Value Score, stocks must have a valid (non-null) ratio and corresponding ranking for at least two of the six valuation ratios.

What Goes Into AAII’s Value Grade?

Stock evaluation requires access to huge amounts of data as well as the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movement. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors with that task.

AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A–F grades for more than just value. It is possible for a stock to appear cheap based on one valuation metric but appear expensive on another. It is also possible for one valuation ratio to be associated with outperforming stocks during certain periods of time but not others. Some stocks may even have null values for certain metrics like the price-earnings ratio or the price-to-book ratio but not others. An example of this would be a company with losses instead of profits or a negative book value because of heavy borrowing. Negative earnings or book value result in non-meaningful ratios that are left blank or null.

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7 Undervalued Investment Management & Fund Operators Stocks

Of course, there are countless value stocks that are worth mentioning, but this is a concise list of the top 7 undervalued stocks in the Investment Management & Fund Operators industry for Wednesday, July 19, 2023. Let’s take a closer look at their individual scores to see how they measure up against each other and the Investment Management & Fund Operators industry median.

The Value Grade is assigned based on how each stock’s composite valuation compares to all other stocks.

The process for assigning grades starts with each variable for a given stock. The percentile rankings for all valid ratios that a stock has are calculated. So, for instance, a stock could have a price-to-book ranking in the 43rd percentile, a price-earnings ranking in the 67th percentile, a price-to-sales ranking in the 23rd percentile, etc. Then, those rankings are averaged for each stock. (A minimum of two valid variables are required, though all six will be used if available.)

Once the average of the individual variables is calculated, that average is ranked against all stocks. Put another way, each stock’s composite valuation is compared to all other stocks. These ranks are then sorted into quintiles from the cheapest 20% (a grade of A) to the most expensive 20% (a grade of F).

As always, we recommend that you conduct proper due diligence and research before investing in any security. We also suggest that investors utilize numerous grades, not just value, when it comes to deciding whether a company is a good fit for their allocation needs.

Affiliated Managers Group, Inc.’s Value Grade

Value Grade:

Affiliated Managers Group, Inc. is a global independent investment management company. The Company is focused on investing in a diverse array of partner-owned investment firms, known as Affiliates. It offers its Affiliates growth capital, global distribution, and other strategic value-added capabilities. Its Affiliates provides a diverse range of differentiated investment strategies designed to assist institutional and wealth clients worldwide in achieving their investment objectives. Its Affiliates also provide investment management and customized investment counseling and fiduciary services to high-net-worth individuals and families and institutional clients. Its Affiliates distribute their investment services and products to institutional and wealth clients through direct sales and relationships with consultants and intermediaries around the world through their own business development capabilities. Its Affiliates manage assets for investors in over 50 countries.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Affiliated Managers Group, Inc. has a Value Score of 72, which is considered to be undervalued.

When you look at Affiliated Managers Group, Inc.’s price-to-sales ratio at 2.59 compared to the industry median at 3.70, this company has a lower price relative to revenue compared to its peers. This could make Affiliated Managers Group, Inc.’s stock more attractive for value investors.

Affiliated Managers Group, Inc.’s price-earnings ratio is 6.97 compared to the industry median at 15.54. This means it has a lower share price relative to earnings compared to its peers. This could make Affiliated Managers Group, Inc. more attractive for value investors.

Now, let’s assess Affiliated Managers Group, Inc.’s EV/EBITDA ratio, also known as enterprise multiple. At 10.9, when compared to the industry median of 15.9, the company may be considered undervalued in relation to its peers. Value investors could use the enterprise multiple to identify stocks that are considered overvalued or undervalued relative to their industry.

Shareholder yield is the sum of a stock’s dividend yield (paid over previous 12 months minus special dividends) and the percentage of net share buybacks over the previous 12 months. Affiliated Managers Group, Inc.’s shareholder yield is higher than its industry median ratio of 3.97%. Value investors may look for an attractive shareholder yield because it can be a powerful tool for identifying if the company has a good management team.

As one of the most common value metrics, the price-to-book ratio evaluates a company’s current market price relative to its book value. Affiliated Managers Group, Inc.’s price-to-book ratio is higher than its industry median ratio of 1.06. This could make Affiliated Managers Group, Inc. less attractive to investors looking for a new addition to their portfolio.

Lastly, let’s take a look at Affiliated Managers Group, Inc.’s price-to-free-cash-flow ratio (P/FCF), which can indicate a company’s market value relative to its operating cash flow. Affiliated Managers Group, Inc.’s price-to-free-cash-flow ratio is lower than its industry median ratio of 11.29. This could make Affiliated Managers Group, Inc. more attractive because the lower P/FCF ratio indicates that Affiliated Managers Group, Inc. is undervalued. The P/FCF ratio metric can also be viewed over a long-term time frame to see if the company's cash flow to share price value is generally improving or worsening.

AMTD IDEA Group - ADR’s Value Grade

Value Grade:

AMTD IDEA Group, formerly AMTD International Inc, is an investment holding company principally engaged in the strategic investments. The Company operates its business through three segments. The Strategic Investment segment engages in proprietary investments and the management of investment portfolios mainly focusing on financial services and asset classes. The Investment Banking segment is involved in raising funds through equity and debt financing, providing underwriting for initial public offerings (IPOs), private placements and debt issuances and providing financial advisory services. The Asset Management segment provides asset management products and services, including in relation to listed equities, fixed income securities, hedge funds, structured products, foreign exchange, private equities, alternative investments, discretionary account services, investment advisory services and external asset management services.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

AMTD IDEA Group - ADR has a Value Score of 80, which is considered to be undervalued.

AMTD IDEA Group - ADR’s price-earnings ratio is 1.0 compared to the industry median at 15.5. This means that it has a lower price relative to its earnings compared to its peers. This makes AMTD IDEA Group - ADR more attractive for value investors.

AMTD IDEA Group - ADR’s price-to-book ratio is higher than its peers. This could make AMTD IDEA Group - ADR less attractive for value investors when compared to the industry median at 1.06.

You can read more about AMTD IDEA Group - ADR’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Federated Hermes Inc’s Value Grade

Value Grade:

Federated Hermes, Inc. is an investment management company. The Company operates through a single segment, the investment management business. It sponsors, markets and provides investment-related services to various investment products, including sponsored investment companies and other funds (Federated Hermes Funds); and Separate Accounts, which include separately managed accounts (SMAs), institutional accounts, sub-advised funds and other managed products in both domestic and international markets. In addition, it markets and provides stewardship and real estate development services to various domestic and international companies. The Company provides investment advisory services to approximately 174 Federated Hermes Funds. It markets these funds to institutional customers and banks, broker/dealers and other financial intermediaries who use them to meet the needs of customers and/or clients, including, among others, retail investors, corporations and retirement plans.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Federated Hermes Inc has a Value Score of 61, which is considered to be undervalued.

Federated Hermes Inc’s price-earnings ratio is 12.4 compared to the industry median at 15.5. This means that it has a lower price relative to its earnings compared to its peers. This makes Federated Hermes Inc more attractive for value investors.

Federated Hermes Inc’s price-to-book ratio is lower than its peers. This could make Federated Hermes Inc more attractive for value investors when compared to the industry median at 1.06.

You can read more about Federated Hermes Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Invesco Ltd.’s Value Grade

Value Grade:

Invesco Ltd. (Invesco) is an independent investment management firm. Invesco serves the retail and institutional markets within the investment management industry in the Americas, Europe, Middle East and Africa (EMEA) and Asia-Pacific in approximately 110 countries. The Company offers a range of investment strategies across asset classes, investment styles, and geographies. The Company's asset classes include equity, fixed income, balanced, alternatives and money market. The Company's retail assets under management include mutual funds, exchange-traded funds (ETFs), separately managed accounts (SMAs), individual savings accounts, investment companies with variable capital (ICVC), investment trusts, open-end mutual funds, unit investment trusts (UIT), and variable insurance funds. Invesco's client base includes public and private entities, unions, non-profit organizations, endowments, foundations, pension funds, financial institutions and sovereign wealth funds.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Invesco Ltd. has a Value Score of 66, which is considered to be undervalued.

Invesco Ltd.’s price-earnings ratio is 13.0 compared to the industry median at 15.5. This means that it has a lower price relative to its earnings compared to its peers. This makes Invesco Ltd. more attractive for value investors.

Invesco Ltd.’s price-to-book ratio is higher than its peers. This could make Invesco Ltd. less attractive for value investors when compared to the industry median at 1.06.

You can read more about Invesco Ltd.’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

9F Inc - ADR’s Value Grade

Value Grade:

9F Inc is a China-based company mainly engaged in the provision of financial investment services through digital financial account platform. The Company's products and services mainly include loan products, online wealth management products, and payment facilitation. The Company provides services, including quota installment, shopping mall installment, credit card management and other services through a smart credit account product One Card (GRAPHIC). The Company also operate a online shopping platform, One Card Mall.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

9F Inc - ADR has a Value Score of 85, which is considered to be undervalued.

9F Inc - ADR’s price-to-book ratio is higher than its peers. This could make 9F Inc - ADR less attractive for value investors when compared to the industry median at 1.06.

You can read more about 9F Inc - ADR’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Noah Holdings Limited (ADR)’s Value Grade

Value Grade:

Noah Holdings Limited is a wealth management service provider with a focus on global wealth investment and asset allocation services for high net worth individuals and enterprises in China. The Company operates through three segments: wealth management, asset management and Internet finance. It also provides Internet finance services to clients in China. It provides direct access to China's high net worth population. With approximately 1,100 relationship managers in over 130 branch offices, its coverage network includes China's regions where high net worth population is concentrated, including the Yangtze River Delta, the Pearl River Delta, the Bohai Rim and other regions. Its product offerings consist primarily of over-the-counter (OTC) wealth management and OTC asset management products, mutual fund products and asset management plans originated in China and designed to cater to the needs of China's high net worth population.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Noah Holdings Limited (ADR) has a Value Score of 77, which is considered to be undervalued.

Noah Holdings Limited (ADR)’s price-earnings ratio is 8.0 compared to the industry median at 15.5. This means that it has a lower price relative to its earnings compared to its peers. This makes Noah Holdings Limited (ADR) more attractive for value investors.

Noah Holdings Limited (ADR)’s price-to-book ratio is higher than its peers. This could make Noah Holdings Limited (ADR) less attractive for value investors when compared to the industry median at 1.06.

You can read more about Noah Holdings Limited (ADR)’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Victory Capital Holdings Inc’s Value Grade

Value Grade:

Victory Capital Holdings, Inc. is a diversified asset management firm. The Company is focused on providing specialized investment strategies to institutions, intermediaries, retirement platforms, and individual investors. It has approximately 12 autonomous investment franchises and a solutions platform, Victory Capital, which offers a range of investment products, including actively and passively managed mutual funds, rules-based and active exchange traded funds (ETFs), institutional separate accounts, variable insurance products (VIPs), Environmental, Social, and Governance (ESG) and impact investment strategies, alternative investments, private closed end funds, and a 529 Education Savings Plan. It also offers its Victory Capitals strategies through third-party investment products, including mutual funds, third-party ETF model strategies, retail separately managed accounts (SMAs) and unified managed accounts (UMAs). Its investment adviser is Victory Capital Management Inc.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Victory Capital Holdings Inc has a Value Score of 65, which is considered to be undervalued.

Victory Capital Holdings Inc’s price-earnings ratio is 9.7 compared to the industry median at 15.5. This means that it has a lower price relative to its earnings compared to its peers. This makes Victory Capital Holdings Inc more attractive for value investors.

Victory Capital Holdings Inc’s price-to-book ratio is lower than its peers. This could make Victory Capital Holdings Inc more attractive for value investors when compared to the industry median at 1.06.

You can read more about Victory Capital Holdings Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Other Investment Management & Fund Operators Stock Grades

Value is just one of the five Stock Grades included in our A+ Investor service. AAII members can see the top-graded stocks—those with grades of A or B for value, growth, momentum, earnings estimate revisions and quality—on the A+ Stock Grades Screener.

Also, if you want full access to all of AAII’s premium services, you can subscribe to one convenient bundled plan called AAII Platinum where you can try out A+ Investor, AAII Dividend Investing, the Stock Superstars Report, Growth Investing and VMQ Stocks. With the other premium services, you can dive deep into additional metrics, portfolios, commentary and information about Investment Management & Fund Operators stocks as well as other industrys.

Choosing Which of the 7 Best Investment Management & Fund Operators Stocks Is Right for You

Choosing which value stocks to invest in will ultimately depend on your individual goals and allocation; however, comparing similar value stocks in the same industry can help you analyze which might be better investments for you in the long run. So, let’s take a look at the Value Grade for all of our stocks.

• Affiliated Managers Group, Inc. stock has a Value Grade of B.
• AMTD IDEA Group - ADR stock has a Value Grade of B.
• Federated Hermes Inc stock has a Value Grade of B.
• Invesco Ltd. stock has a Value Grade of B.
• 9F Inc - ADR stock has a Value Grade of A.
• Noah Holdings Limited (ADR) stock has a Value Grade of B.
• Victory Capital Holdings Inc stock has a Value Grade of B.

Now that you have a bit more background about each of the 7 undervalued stocks in the Investment Management & Fund Operators industry as well as their overall grades, it’s time for you to conduct additional research to see if these could fit your portfolio needs based on your goals and risk tolerance. AAII can help you figure out both and identify which investments align with what works best for you.

We do so through a program of education that teaches you to invest for yourself and become an effective manager of your own wealth—no more relying on others for your financial independence. You can rely on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis that makes you a better investor.

A+ Investor adds to that qualitative teaching by giving you a powerful data suite that helps you whittle down investment decisions to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.

Additional Resources About Investment Management & Fund Operators Stocks

Want to learn more about Investment Management & Fund Operators stocks to see if they could be the right investment for you? Check out some additional resources and articles to help you on your financial journey.

• 7 Undervalued Investment Management & Fund Operators Stocks for Wednesday, July 19
• What You Need to Know About BlackRock Inc's Q1 Earnings
• What You Need to Know About State Street Corp's Q2 Earnings
• 5 Undervalued Investment Management & Fund Operators Stocks for Tuesday, July 18

AAII Disclaimer

We make no representations or warranties that any investor will, or is likely to, achieve profits similar to those shown, because past, hypothetical or simulated performance is not necessarily indicative of future results. Before making an investment decision, you should consider your circumstances and whether the information on our content is applicable to your situation. This information was prepared in good faith and we accept no liability for any errors or omissions. The full disclaimer can be read here.