SEI Investments Earnings: Investment Managers Segment Continues to Shine, Mixed Indicators Elsewhere

Boosted by market appreciation, narrow-moat SEI reported a decent finish to the end 2023. Revenue of $485 million and EPS of $0.91 compare with the FactSet consensus estimate of $483 million and $0.93, respectively. We attribute the EPS miss to $11 million in one-time charges—an asset write-off and severance charges—which, by our calculations make a negative impact on EPS of $0.07. As we’ve seen in previous quarters, the firm’s investment managers segment continues to be its fastest grower with 12% growth, while net new recurring sales of $15 million were healthy, in our view. The firm’s private banks margin showed improvement and trends were mixed in the advisors segment. The institutional investors segment continues to be weak. As we incorporate fourth-quarter financial results, we expect to increase our fair value estimate of $66 by a single-digit percentage due primarily to market appreciation and the time value of money.