Earnings Extravaganza: This Week's Financial Fiesta!
BlackRock and Wise Shine Bright in Latest Reports
Hold onto your hats, folks! Earnings season is upon us, and this week brought some exciting news from two financial giants: BlackRock and Wise. Both companies delivered impressive results, showcasing strong growth and strategic moves that have us saying "cha-ching!" Let's dive into the highlights and see why these companies are making waves in the financial world.
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Blackrock: Making Money Moves in 2024!
EPS on the Rise!
BlackRock's full-year 2024 diluted EPS hit a cool $42.01, a 15% jump from last year!
Key Financial Metrics, the Good Stuff:
AUM to the Moon! BlackRock's AUM reached a massive $11.6 trillion after a record $641 billion of full-year net inflows. Talk about growth!
Revenue Rolling In! Full-year revenue increased by 14%, fueled by organic base fee growth, higher performance fees, and booming technology service revenue.
Operating Income: Efficiency is Key! BlackRock reported a 21% increase in full-year operating income, showing they know how to run a tight ship.
Sharing the Wealth! The company returned a hefty $4.7 billion to shareholders in 2024, including $1.6 billion in share buybacks.
Strategic Acquisitions the Power Plays:
BlackRock made some big moves in 2024, snapping up Global Infrastructure Partners (GIP) and setting its sights on HPS Investment Partners. These acquisitions are set to supercharge BlackRock's private markets investment and data capabilities.
Important Note: Even with the huge $5 billion buyback, the share count went up! Weighted-average diluted shares are now at 157 million, a 5% increase compared to last year.
Other Highlights and More Good News:
Organic Growth: Steady and Strong! BlackRock enjoyed 7% organic base fee growth and 12% growth in technology services annual contract value (ACV). Clients are loving them!
Margin Expansion: Top of the Class! The company's operating margin expanded to an impressive 44.5%, showing they're a leader in the industry.
EPS Breakdown (aka the Nitty Gritty):
Full Year 2024 Diluted EPS: $42.01
Fourth Quarter 2024 Diluted EPS: $10.63
Now let’s check what happened on wise side, as you know it is part of the portfolio since last November.
Wise: Crushing it in Q3!
Wise is on a roll!
Their Q3 Trading Update shows some seriously impressive financial performance and growth:
Customer Explosion: Active customers grew by 20% year-over-year, topping 9 million.
Cross-Border Boom: Cross-border volumes surged by 24% (27% in constant currency) to a whopping £37.8 billion.
Account Balances Skyrocketing: Balances grew by a healthy 26% to £16.2 billion.
Card and Other Revenue on Fire: A 39% year-over-year increase, fueled by the ever-growing popularity of the Wise account.
Underlying Income: Solid Growth: Grew by 13% year-over-year to £349.5 million in Q3, bringing year-to-date growth to 17%.
Wise is all about value!
Their focus on reducing costs allowed them to slash prices, resulting in an 11bps year-over-year reduction in the cross-border take rate to 56bps in Q3.
Key Factors to Keep in Mind the Important Notes:
New Partners: Power Plays. Wise inked deals with Morgan Stanley and Standard Chartered, proving the strength of their platform!
Take Rate Reduction: Winning Strategy. Wise deliberately lowered its cross-border take rate by 11bps YoY to 56bps in Q3, passing the savings on to customers!
FX Headwinds: A Minor Hiccup. Changes in foreign exchange rates have "understated" growth a bit. The 13% YoY growth in underlying income is actually closer to 20% on a constant currency basis.
Full-Year Growth Target: On Track. They're still expecting underlying income growth of 15-20% in FY25, with reported growth likely at the lower end of this range due to those pesky FX headwinds.
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