Analyst Note| Greggory Warren, CFA |
While there was little in wide-moat T. Rowe Price's second-quarter results that would alter our long-term view of the firm, we are likely to raise our $114 fair value estimate on improvements seen in the firm's near-term results that will positively impact our medium-term forecast. T. Rowe Price closed out the June quarter with a record $1.220 trillion in managed assets, up 20.9% sequentially and 8.4% on a year-over-year basis. Net inflows of $14.7 billion during the quarter were better than our expectations, as well as the positive $2.4 billion quarterly run rate we've seen for net flows at T. Rowe Price since the end of the 2008-09 financial crisis. Target-date funds saw an uncharacteristic $200 million in outflows during the second quarter, with most of the positive flows actually coming from the firm's subadvisory and separate account portfolios.