NASDAQ$VCTR

Victory Capital Holdings Inc · Q2 2020 earnings

Q2 2020 earnings · · Investor relations

Briefing

Reported record financial results with increased AUM and improved profitability.

Victory Capital reported strong second-quarter results, marked by a significant increase in revenue and net income compared to the previous year, driven by the acquisition of USAA Asset Management Company. The company saw a rise in assets under management (AUM) and improved operating margins, reflecting enhanced operating leverage. The board also authorized a 20% increase in the regular quarterly cash dividend.

  • Total Assets Under Management (AUM) reached $129.1 billion.
  • Long-term gross flows were $5.2 billion with net outflows of $3.0 billion.
  • GAAP net income was $0.61 per diluted share, a 205% increase year-over-year.
  • Adjusted net income with tax benefit was $0.89 per diluted share, up 135% year-over-year.

Headline financials

Total Revenue

$181M

Previous: $90.8M+99.3%
EPS (adj)

$0.89

Previous: $0.38+134.2%
Ending AUM

$129B

No prior period
GAAP Operating Margin

36.2%

No prior period
Adjusted EBITDA Margin

47.5%

No prior period
Capital Expenditures

-$5.28M

Previous: -$892K-491.9%
Free Cash Flow

$39.4M

Previous: $13.5M+192.3%
Net Income

$44.7M

Previous: $14.4M+210.9%
Operating Income

$65.8M

Previous: $22.7M+189.6%
Gross Profit

$171M

Previous: $86.3M+98.4%
Cash & Equivalents

$55.2M

Previous: $23.4M+135.7%
Total Assets

$1.75B

Previous: $841M+107.8%

Revenue & EPS history

Victory Capital · Revenue · Quarterly

$181M

Q2 2020+99.3%vs Q2 2019
Beat estimate in 10 of 13 quarters(77%)
ActualEstimate

Forward guidance

The company is focused on integrating the USAA acquisition, launching a new digital experience, and evaluating potential acquisition opportunities. Victory Capital aims to continue reducing debt and enhancing service to members, while also broadening its commitment to responsible investing.

Tailwinds

  • Successful integration of the USAA acquisition.
  • Launch of a new digital experience to enhance service.
  • Commitment to responsible investing through PRI signatory.
  • Strong investment performance of Investment Franchises.
  • Focus on debt reduction and potential acquisition opportunities.

Headwinds

  • Challenging market environment and extreme volatility.
  • Net outflows including asset flows related to the closing of the sale of USAA’s brokerage business.
  • Decrease in revenue compared to the previous quarter.
  • Contraction of GAAP operating margin compared to the previous quarter.
  • Decline in GAAP net income compared to the previous quarter.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2020

Historical avgQ2 2020

+1.6%

Avg return

Earnings day

+2.1%

Avg return

5 days after

+1.3%

Avg return

30 days after

50%

20 / 40 earnings

Positive

+22.4%

Q3 2018

Best reaction

-6.6%

Q1 2024

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+1.9%+4.0%+4.4%
Q4 2025-2.2%+8.3%-1.5%
Q3 2025-0.8%+3.0%+3.2%
Q1 2025-1.6%+7.6%+8.1%
Q4 2024+7.5%+3.4%-10.9%
Q3 2024+2.1%-0.0%+4.3%
Q2 2024+8.2%+9.1%+13.0%
Q1 2024-6.6%-1.3%-4.7%
Q4 2023+4.8%-0.6%+13.1%
Q3 2023+8.9%+5.2%+8.0%
Q2 2023+1.7%+0.1%+4.9%
Q1 2023+0.8%+2.5%+9.2%
Q4 2022-2.8%+4.7%-3.2%
Q3 2022+0.7%+3.0%+4.9%
Q2 2022-0.2%-1.1%-4.4%
Q1 2022-6.4%-10.1%+1.2%
Q4 2021-3.0%-3.5%-11.8%
Q3 2021+11.7%+10.4%-7.9%
Q2 2021+6.5%+7.0%+6.7%
Q1 2021+6.3%+3.6%+7.1%
Q4 2020+2.4%+0.8%+4.7%
Q3 2020+7.2%+7.3%+22.5%
Q2 2020+0.3%+3.7%-1.5%
Q1 2020+0.7%-6.1%+21.5%
Q4 2019-1.8%-2.4%-34.8%
Q3 2019+9.8%+11.3%+26.9%
Q2 2019-1.7%-8.2%-2.2%
Q1 2019+5.8%+16.9%+12.4%
Q4 2018-2.4%+1.6%+17.6%
Q3 2017-0.6%+1.3%-10.2%
Q3 2018+22.4%+39.9%+38.7%
Q2 2018-1.8%-0.5%-5.0%
Q1 2017-1.7%-2.6%+2.4%
Q1 2018-0.6%-4.5%+2.2%
Q2 2017-2.8%-6.6%-14.8%
Q2 2016-2.8%-6.6%-14.8%
Q4 2016-2.8%-6.6%-14.8%
Q3 2016-2.8%-6.6%-14.8%
Q4 2015-2.8%-6.6%-14.8%
Q4 2017+4.2%+3.2%-11.0%
Q1 2016

Discussion

Share your read of this quarter. Sign-in carries your eToro identity.

Join the conversation

Sign in with eToro to post your read of this quarter and vote on others'.

Sign in with eToro