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FinancialsT. Rowe Price
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Market Data
Financials
XBRL · SEC EDGAR2007–2025(19yr)| Metric | FY 2007 | FY 2008 | FY 2009 | FY 2010 | FY 2011 | FY 2012 | FY 2013 | FY 2014 | FY 2015 | FY 2016 | FY 2017 | FY 2018 | FY 2019 | FY 2020 | FY 2021 | FY 2022 | FY 2023 | FY 2024 | FY 2025Latest | YoY |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | $2.2B | $2.1B | $1.9B | $2.4B | $2.7B | $3.0B | $3.5B | $4.0B | $4.2B | $4.3B | $4.9B | $5.4B | $5.6B | $6.2B | $7.7B | $6.5B | $6.5B | $7.1B | $7.3B | +3.1% |
| Gross Profit | $2.2B | $2.1B | $1.9B | $2.4B | $2.7B | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Gross Margin | 99.8% | 99.8% | 99.8% | 99.9% | 100.0% | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Operating Income | $996.4M | $848.5M | $701.6M | $1.0B | $1.2B | $1.4B | $1.6B | $1.9B | $1.9B | $1.7B | $2.1B | $2.4B | $2.4B | $2.7B | $3.7B | $2.4B | $2.0B | $2.3B | $2.2B | -6.2% |
| Operating Margin | 44.6% | 40.0% | 37.5% | 43.7% | 44.7% | 45.1% | 47.0% | 47.5% | 45.2% | 40.5% | 43.4% | 44.0% | 42.5% | 44.2% | 48.4% | 36.6% | 30.7% | 32.9% | 29.9% | -3.0pp |
| Net Income | $670.6M | $490.8M | $433.6M | $672.2M | $773.2M | $883.6M | $1.0B | $1.2B | $1.2B | $1.2B | $1.5B | $1.8B | $2.1B | $2.4B | $3.1B | $1.6B | $1.8B | $2.1B | $2.1B | -0.6% |
| Net Margin | 30.0% | 23.1% | 23.2% | 28.4% | 28.1% | 29.2% | 30.1% | 30.9% | 29.1% | 28.4% | 30.9% | 34.2% | 37.9% | 38.2% | 40.2% | 24.0% | 27.7% | 29.6% | 28.5% | -1.1pp |
| Free Cash Flow | $612.4M | $597.7M | $401.7M | $614.8M | $866.1M | $825.9M | $1.1B | $1.2B | $1.4B | $22.2M | $43.4M | $1.5B | $1.3B | $1.7B | $3.2B | $2.1B | $911.2M | $1.3B | $1.5B | +17.2% |
| FCF Margin | 27.4% | 28.2% | 21.5% | 25.9% | 31.5% | 27.3% | 32.4% | 29.3% | 32.3% | 0.5% | 0.9% | 27.0% | 23.5% | 27.5% | 41.9% | 32.7% | 14.1% | 17.8% | 20.2% | +2.4pp |
| EPS (Diluted) | $2.40 | $1.81 | $1.65 | $2.53 | $2.92 | $3.36 | $3.90 | $4.55 | $4.63 | $4.75 | $5.97 | $7.27 | $8.70 | $9.98 | $13.12 | $6.70 | $7.76 | $9.15 | $9.24 | +1.0% |
1. THE BIG PICTURE
T. Rowe Price is a high-margin incumbent fighting a disciplined but defensive battle against the commoditization of asset management. While T. Rowe Price remains a powerhouse in the retirement market, it is currently forced to trade off fee levels for asset retention as clients migrate toward lower-cost products (8-K). Its survival strategy rests on whether it can successfully port its "active, independent approach" into the private and alternatives markets before fee compression erodes its earnings power (10-K Item 1).
2. WHERE THE RISKS HIT HARDEST
T. Rowe Price’s "leadership position in retirement" (10-K Item 1) is directly challenged by "fee compression and competition" (10-K Item 1A). As the industry shifts toward passive products, T. Rowe Price must lower its advisory rates to remain competitive on the platforms of third-party financial intermediaries. This vulnerability is already visible: the investment advisory annualized effective fee rate fell to 38.8 basis points in Q4 2025, down from 40.5 basis points a year earlier (8-K). Furthermore, T. Rowe Price’s reliance on "highly skilled professionals" (10-K Item 1A) creates a margin trap; it must increase compensation to retain talent while its primary revenue driver—advisory fees—is under constant downward pressure.
3. WHAT THE NUMBERS SAY TOGETHER
The financial data reveals a stark contrast between current profitability and future expectations. T. Rowe Price boasts the highest net margin in its peer group at 31.3%, yet it trades at the deepest valuation discount at 8.8x Forward P/EP/EPrice-to-Earnings ratio — share price divided by annual earnings per share; how much investors pay per dollar of profit. Higher P/E = higher growth expectations (Yahoo Finance). This gap suggests the market views T. Rowe Price’s profitability as a legacy peak rather than a sustainable floor. While Q4 2025 revenue grew 6.0%, this was largely a function of market appreciation; T. Rowe Price actually suffered $25.5 billion in net client outflows during the same period (8-K). The high short interest—11.5% of the float—indicates significant market conviction that these outflows will eventually overwhelm the benefits of rising markets (Yahoo Finance).
4. IS IT WORTH IT AT THIS PRICE?
At 8.8x Forward P/EP/EPrice-to-Earnings ratio — share price divided by annual earnings per share; how much investors pay per dollar of profit. Higher P/E = higher growth expectations, the market is pricing in a long-term growth rate of just 1.7% (CAPM analysis). Because this multiple is more than 25% below the peer median of 12.5x, T. Rowe Price appears attractively valued for income-focused investors, provided they accept the structural risks (Yahoo Finance). This discount is justified by a revenue growth rate of 3.1%, which is anemic compared to BlackRock’s 89.3% or Blackstone’s 9.2%. While the 5.7% dividend yield is the highest among its peers, the "mix shift... toward lower fee products" (8-K) remains the primary headwind that could prevent the stock from re-rating to a higher multiple.
5. WHAT WOULD CHANGE THIS VIEW?
- Constructive if net client flows turn positive for two consecutive quarters, proving that new ETF and alternative product launches are finally offsetting the attrition in active equity funds (8-K).
- Cautious if the annualized effective fee rate continues to slide toward 35 basis points, indicating that T. Rowe Price is losing its pricing power faster than it can cut expenses (8-K).
- Cautious if short interest climbs above 15%, signaling that institutional sentiment is further deteriorating despite the high dividend yield (Yahoo Finance).
6. BOTTOM LINE
Structural Advantage: A dominant leadership position in the U.S. retirement market supported by a specialized distribution network and a high-margin active management engine.
Bottom Line: T. Rowe Price is a highly profitable cash generator whose low valuation reflects a valid market fear that its core business is in a slow, structural decline.
1. Top 5 Material Risks
- Market Value of AUM: Because advisory fees are calculated as a percentage of AUM, any decline in financial markets or poor relative investment performance leads to lower revenues.
- Fee Compression and Competition: The industry-wide shift toward passive investment products and consolidation among competitors forces T. Rowe Price to potentially reduce fees, which directly lowers operating margins and net income.
- Contractual Termination: A majority of revenue is derived from commingled vehicles that can terminate investment management agreements on short notice, creating immediate revenue volatility.
- Operational and Technology Failure: T. Rowe Price relies on complex, non-redundant technology systems; failures in these systems or cyberattacks could disrupt operations, lead to regulatory fines, and damage T. Rowe Price's reputation.
- Key Personnel Retention: The business depends on highly skilled professionals; the loss of key talent or the need to increase compensation to retain them directly reduces net income.
2. Company-Specific Risks
- Geographic Concentration: A significant portion of operations is concentrated in specific regions, including Baltimore, Maryland; Colorado Springs, Colorado; Fort Worth, Texas; New York City, New York; and London, England, making T. Rowe Price vulnerable to localized natural disasters or infrastructure failures.
- Alternative Product Liabilities: Expanding into private credit, real estate, and infrastructure exposes T. Rowe Price to new risks, including asset illiquidity, valuation challenges, and potential direct liability for losses or regulatory sanctions.
- Hedging Ineffectiveness: T. Rowe Price utilizes hedging strategies for deferred compensation plans; if these strategies fail, the resulting liability directly impacts net income.
- AI Model Uncertainty: The integration of artificial intelligence into investment processes introduces risks related to model errors, lack of transparency, and potential regulatory non-compliance, which could harm T. Rowe Price's reputation and financial results.
3. Regulatory/Legal Risks
- Regulatory Compliance Costs: T. Rowe Price faces an evolving global regulatory landscape, including rules on sustainability, cybersecurity, and data privacy (such as GDPR), which increases compliance expenses and operational complexity.
- Administrative Law Challenges: Following the Supreme Court’s decision in Loper Bright Enterprises v. Raimondo, T. Rowe Price faces increased uncertainty regarding federal agency rulemaking, which may lead to legal challenges against regulations T. Rowe Price has relied upon.
- Net Capital Requirements: Certain subsidiaries are subject to mandatory net capital requirements; an operating loss or extraordinary charge could restrict these subsidiaries' ability to maintain or expand operations.
- Tax Audits: T. Rowe Price operates in multiple global jurisdictions with complex tax regimes; disagreements with tax authorities regarding prior-period positions could result in unexpected payments for taxes, interest, and penalties.
4. Financial Impact Map
Market Value of AUM → Investment Advisory Fees → Revenue is directly dependent on the market value and composition of assets under management. Fee Compression → Operating Margins → Reductions in fees to remain competitive result in a disproportionate decline in net income because certain expenses remain fixed. Contractual Termination → Net Income → Termination of agreements with commingled vehicles leads to a direct decline in fees earned. Key Personnel Retention → Compensation Expense → Increased costs to retain or replace talent directly decrease net income. Operational/Technology Failure → Operating Expenses → Significant capital expenditures are required to maintain, upgrade, or repair technology infrastructure following a failure or to remain competitive.
Recent Filings
| Form | Filed | Period |
|---|---|---|
| 10-K | Feb 2026 | Dec 2025 |
| 8-K | Feb 2026 | — |
| 10-Q | Oct 2025 | Sep 2025 |
| 14A | Mar 2025 | — |
AI-extracted key facts from press releases and SEC filings. Significance 1–10.
T. Rowe Price Q4 revenue $1.94B +5.4% YoY, meets analyst expectations
- ▸T. Rowe Price Q4 revenue $1.94B, +5.4% YoY, in-line with estimates
- ▸WisdomTree Q4 revenue $147.4M, +33.4% YoY, beat estimates by 3%
- ▸Voya Financial Q4 revenue $2.01B, +5.7% YoY, missed EPS estimates
- ▸Custody bank sector Q4 revenues beat consensus estimates by 2.4%
- ▸Custody bank stocks down 11% on average since Q4 earnings reports
T. Rowe Price Launches OFLEX Multi-Strategy Credit Interval Fund for Wealth Clients
- ▸Launched T. Rowe Price OHA Flexible Credit Income Fund (OFLEX)
- ▸Fund provides exposure to direct lending, CLOs, and liquid credit
- ▸Structured as interval fund with quarterly liquidity for 5% of shares
- ▸Expands alternative investment suite following 2021 Oak Hill Advisors acquisition
- ▸Strategy aims to capture premium yields across volatile market environments
T. Rowe Price reports $5.3B February net outflows amid ongoing share price decline
- ▸February net outflows totaled $5.3B
- ▸Share price down 15.33% year-to-date to $88.59
- ▸Launched new Emerging Markets Equity Research ETF
- ▸5-year total shareholder return of 36.21% decline
- ▸Estimated fair value of $102.08 per share
T. Rowe Price Launches Emerging Markets Equity Research ETF (TEMR) With 0.40% Expense Ratio
- ▸Launched T. Rowe Price Emerging Markets Equity Research ETF (TEMR) on NYSE Arca
- ▸TEMR features 0.40% net expense ratio and active management strategy
- ▸February net outflows totaled $5.3 billion
- ▸Quarterly dividend increased 2.4% to $1.30 per share
- ▸Firm manages $1.80 billion in total ETF assets under management
T. Rowe Price February AUM $1.80T with $5.3B Net Outflows; Launches Emerging Markets ETF
- ▸February AUM $1.80 trillion, up from $1.79 trillion in January
- ▸Net outflows for February totaled $5.3 billion
- ▸Equity strategies represent $868 billion of total AUM
- ▸Launched T. Rowe Price Emerging Markets Equity Research ETF (TEMR)
- ▸TEMR fund targets 180-280 securities for long-term capital growth
OCREDIT Q4 2025 Net Investment Income $0.65/share, Declares $0.69 Distribution
- ▸Q4 2025 net investment income $0.65 per share
- ▸Total distributions declared $0.69 per share with 10.3% dividend yield
- ▸Net asset value per share $26.89 as of December 31, 2025
- ▸Portfolio net growth of $210.1 million with 10.0% weighted average yield
- ▸Debt-to-equity ratio increased to 0.90x from 0.80x in Q3