T. Rowe Price Earnings: Equity Outflows Offset by Market Gains, Leading to Improved AUM Levels

There was little in wide-moat-rated T. Rowe Price's second-quarter results that would alter our long-term view of the firm. The company's adjusted earnings per share of $2.02 for the June quarter was well above the FactSet consensus estimate of $1.73 per share and our own $1.80 forecast. The majority of the outperformance was driven by higher levels of assets under management, or AUM, revenue and operating income than we had projected for the period. We expect to adjust our $110 per share fair value estimate upward slightly as we incorporate these results into our valuation.