T. Rowe Price Group Inc (TROW, Financial) has recently been in the spotlight, drawing interest from investors and financial analysts due to its robust financial stance. With shares currently priced at $108.1, T. Rowe Price Group Inc has witnessed a daily gain of 1.25%, marked against a three-month change of -0.92%. A thorough analysis, underlined by the GF Score, suggests that T. Rowe Price Group Inc is well-positioned for substantial growth in the near future.
What Is the GF Score?
The GF Score is a stock performance ranking system developed by GuruFocus using five aspects of valuation, which has been found to be closely correlated to the long-term performances of stocks by backtesting from 2006 to 2021. The stocks with a higher GF Score generally generate higher returns than those with a lower GF Score. Therefore, when picking stocks, investors should invest in companies with high GF Scores. The GF Score ranges from 0 to 100, with 100 as the highest rank.
- Financial strength rank: 8/10
- Profitability rank: 10/10
- Growth rank: 10/10
- GF Value rank: 7/10
- Momentum rank: 7/10
Each one of these components is ranked and the ranks also have positive correlation with the long term performances of stocks. The GF score is calculated using the five key aspects of analysis. Through backtesting, we know that each of these key aspects has a different impact on the stock price performance. Thus, they are weighted differently when calculating the total score. With high ranks in financial strength, profitability, and growth, and slightly lower yet strong ranks in GF Value and momentum, GuruFocus assigned T. Rowe Price Group Inc the GF Score of 98 out of 100, which signals the highest outperformance potential.
Understanding T. Rowe Price Group Inc's Business
T. Rowe Price Group Inc, with a market cap of $24.16 billion and sales of $6.34 billion, operates with a healthy operating margin of 32.15%. The company provides asset-management services for individual and institutional investors, offering a broad range of no-load U.S. and international stock, hybrid, bond, and money market funds. As of the end of October 2023, T. Rowe Price Group Inc managed $1.312 trillion in assets, diversified across equity, balanced, fixed-income, money market, and alternative offerings. With approximately two-thirds of its managed assets in retirement-based accounts, T. Rowe Price Group Inc benefits from a relatively stable client base. The firm also offers private account management, retirement planning advice, and discount brokerage and trust services, with a primary focus on the U.S. market but also a significant presence overseas.
Financial Strength Breakdown
According to the Financial Strength rating, T. Rowe Price Group Inc's robust balance sheet exhibits resilience against financial volatility, reflecting prudent management of capital structure. With an Altman Z-Score of 8.39, T. Rowe Price Group Inc exhibits a strong defense against financial distress, highlighting its robust financial stability. With a favorable Debt-to-Revenue ratio of 0.05, T. Rowe Price Group Inc's strategic handling of debt solidifies its financial health.
Profitability Rank Breakdown
The Profitability Rank shows T. Rowe Price Group Inc's impressive standing among its peers in generating profit. T. Rowe Price Group Inc's strong Predictability Rank of 5.0 stars out of five underscores its consistent operational performance, providing investors with increased confidence.
Growth Rank Breakdown
Ranked highly in Growth, T. Rowe Price Group Inc demonstrates a strong commitment to expanding its business. The company's 3-Year Revenue Growth Rate is 6.7%, which outperforms better than 51.63% of 891 companies in the Asset Management industry. Moreover, T. Rowe Price Group Inc has seen a robust increase in its earnings before interest, taxes, depreciation, and amortization (EBITDA) over the past few years. Specifically, the three-year growth rate stands at 8.6, and the rate over the past five years is 11.7. This trend accentuates the company's continued capability to drive growth.
Next Steps
Considering T. Rowe Price Group Inc's financial strength, profitability, and growth metrics, the GF Score highlights the firm's unparalleled position for potential outperformance. Investors looking for similar opportunities can explore more companies with strong GF Scores using the GF Score Screen. As T. Rowe Price Group Inc continues to navigate the financial landscape with its robust asset management strategies and strong financial metrics, it stands as a compelling investment case for those seeking market outperformance.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
