Skip to main content

Market Overview

Manning & Napier's Dividend Could Be At Risk As Q3 Results Come In Below Expectations


Manning and Napier Inc (NYSE: MN) reported disappointing Q3 results. “Continued pressure on revenues and elevated compensation costs are likely to keep pressure on margins,” Keefe, Bruyette & Woods’ Robert Lee said in a report. He downgraded the rating on the company from Market Perform to Underperform, while reducing the price target from $7.75 to $7.00.

There is risk to Manning & Napier's dividend if the current weakness persists, analyst Lee mentioned.

Poor Results

The company reported weaker-than-expected Q3 results, mainly due to lower revenues. Net outflows came in at $2.3 billon, almost in-line with KBW’s $2.4 billon forecast. “While investment performance has improved, we expect flows to remain negative,” Lee wrote.

Pre-tax operating margin was 34.3 percent, short of the expectation of 36.4 percent. The analyst pointed out that Manning & Napier's margins could remain under pressure if there is continued pressure on revenues and compensation costs remain elevated.

Estimates Reduced

The analyst lowered the EPS estimates for 2016, 2017 and 2018 from $0.73 to $0.69, from $0.71 to $0.63 and from $0.72 to $0.62, respectively, “mainly to reflect higher expected compensation expense, but also somewhat weaker revenues due to sustained outflows.”

Dividend At Risk

In case AUM and related revenues and earnings continue to be under pressure, the company’s dividend “is likely at risk as we doubt that management would want to use, at least for an extended period of time, its excess cash on the balance sheet to support the dividend,” Lee stated.

Do you have ideas for articles/interviews you'd like to see more of on Benzinga? Please email with your best article ideas. One person will be randomly selected to win a $20 Amazon gift card!

Latest Ratings for MN

Jun 2017Keefe, Bruyette & WoodsUpgradesUnderperformMarket Perform
Oct 2016Keefe, Bruyette & WoodsDowngradesMarket PerformUnderperform
Oct 2016Keefe, Bruyette & WoodsMaintainsMarket Perform

View More Analyst Ratings for MN
View the Latest Analyst Ratings


Related Articles (MN)

View Comments and Join the Discussion!

Posted-In: Bruyette & Woods KeefeAnalyst Color Short Ideas Downgrades Price Target Analyst Ratings Trading Ideas

Latest Ratings

SVLake StreetInitiates Coverage On20.0
CLSDJMP SecuritiesMaintains9.0
WPCJP MorganUpgrades88.0
BRKRCleveland ResearchUpgrades
NTRRaymond JamesDowngrades82.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Everything you need to know about the latest SPAC news.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at