Q2 2026 Westwood Holdings Group Inc Earnings Call Transcript
Key Points
- Westwood Holdings Group Inc (WHG) reported strong growth in its ETF platform, surpassing $400 million in assets under management in July, with the Enhanced Income Series ETFs gaining significant advisor and investor interest.
- The company closed $147 million in new private capital commitments during the quarter, bringing total commitments to over half a billion dollars, which carry management fees of 1% to 1.5% and potential future carry.
- Multi-asset and wealth team strategies posted strong long-term performance, with more than half of multi-asset strategies ranking in the top third or better against peers over three-year and longer periods.
- The company is strategically positioned for growth with three emerging business lines—managed investment solutions, ETFs, and private capital—each having grown to approximately $500 million in assets, with a goal to surpass $1 billion in each.
- Westwood Holdings Group Inc (WHG) announced a strategic partnership with ETF Capital Markets Advisors to enhance liquidity, pricing, and execution quality for its growing ETF lineup, and is set to launch the PWRX ETF on the Texas Stock Exchange in mid-September.
- The company reported a favorable comparison in GAAP income, with second quarter income of $1.5 million or $0.17 per share, up from $0.8 million or $0.09 per share in the first quarter, and economic earnings of $3 million or $0.33 per share.
- Westwood Holdings Group Inc (WHG) experienced significant net outflows of $1.6 billion in assets under management during the quarter, driven by outflows from US value institutional clients, particularly the legacy large cap value business.
- The company's US value strategies have shown mixed and softer performance over recent periods, contributing to client outflows as investors shift toward lower-fee passive options like ETFs.
- Small cap value experienced outflows due to a single client consolidating its small and mid-cap allocations into a combined mid-cap mandate, resulting in redemptions in June.
- The mutual fund and ETF flows showed net outflows of $165 million despite $168 million in gross sales, indicating continued pressure in certain product lines.
- The company noted that while building its ETF and private capital businesses, fee waivers are necessary in early years to keep expense ratios down, which may temper near-term revenue growth from these platforms.
- Inflation concerns, driven by rising energy prices tied to the Middle East conflict, have reemerged as a key concern, pushing bond yields higher and potentially impacting market conditions.
Good day and thank you for standing by. Welcome to the second quarter 2026 Westwood Holdings Group Earnings Conference Call. (Operator Instructions) Please be advised that today's conference call is being recorded.
I would now like to hand the conference over to your first speaker today, John Ehringer, Managing Director, Head of Legal and Compliance.
Thank you and welcome to our second quarter 2026 earnings conference call.
The following discussion will include forward-looking statements that are subject to known and unknown risks, uncertainties, and other factors which may cause actual results to be materially different from those contemplated by the forward-looking statements. Additional information concerning the factors that could cause such a difference is included in our press release issued earlier today, as well as in our Form 10-Q for the quarter ended June 30, 2026. that will be filed with the Securities and Exchange Commission. We undertake no
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