Legg Mason Misses Targets

Earnings are underwhelming at three notable asset managers.
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Legg Mason

(LM) - Get Report

fell 4% early Tuesday after the asset manager missed first-quarter earnings targets.

The Baltimore-based money manager earned $112.8 million, or 93 cents a share, up from $86.4 million, or 76 cents a share, in the year-ago period. Legg's results were 7 cents shy of the Thomson First Call consensus estimate, in part because of higher-than-expected costs on an asset swap with

Citigroup

(C) - Get Report

.

Assets under management rose to $397.5 billion, up from $372.9 billion the previous quarter and $295.7 billion a year earlier.

The company said its results were hurt by the pending sale of its brokerage business to Citigroup as well as challenging market conditions. Legg said it anticipates the businesses will continue to be hit by the distractions of the pending sale.

Also, a Banc of America Securities analyst cut his rating on Legg Mason Tuesday to sell from neutral, noting that shares have gained over 30% since the Citigroup announcement in June.

Another asset manager,

Waddell & Reed

(WDR) - Get Report

, reported a loss in its second quarter on Tuesday after accounting for charges associated with securities probes and severance for its former chief executive.

Overland Park, Kan.-based Waddell reported a net loss of $7.1 million, or 9 cents a share, compared with a net profit of $25.2 million, or 31 cents per share, last year.

Excluding the one-time costs, the company earned $21.7 million, or 27 cents a share. Analysts had been expecting 28 cents a share.

"While there were some encouraging signs in our sales activity results, this quarter showed a continuation of less than acceptable operating performance," Henry Herrmann, chief executive, said in a statement.

Total assets under management were up 7.5% to $39.1 billion from $36.4 billion a year earlier, according to the company.

Finally, newly public

Calamos Asset Management

(CLMS)

said on Tuesday that its second-quarter earnings beat analysts' expectations as assets under management grew 22% to $39.5 billion.

Naperville, Ill.-based Calamos, which went public last October, said net income advanced to $7 million, or 30 cents a diluted share, from the pro forma $4.4 million, or 19 cents a share, a year ago. Analysts were anticipating 28 cents a share.

Early Tuesday, Legg Mason fell $4.19 to $107.83, Waddell dropped 13 cents to $19.77, and Calamos gave back 27 cents to $29.01.