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Ameriprise Financial Inc AMP

Rating as of

Morningstar’s Analysis

Valuation
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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Ameriprise Maintains High ROE and Capital Returns After Asset Management Acquisition

Michael Wong, CFA, CPA Sector Director

Analyst Note

| Michael Wong, CFA, CPA |

Ameriprise reported net income of $437 million, or $3.58 per diluted share, on $3.35 billion of net revenue during the first quarter of 2021. On a company-provided adjusted operating basis, which excludes the effect of changes in interest rates on some of its products and a tax benefit in the prior year period, the company reported pro forma operating earnings of $5.43 per share, up 27% from the previous year. Adjusted operating return on equity for the firm, which excludes accumulated other comprehensive income, was a strong 29.9% during the first quarter. Along with first-quarter earnings, Ameriprise announced it was increasing its quarterly dividend 9% to $1.13 per share. While the firm's reported results for the March quarter were impressive, we don’t anticipate making a material change to our $208 per share fair value estimate for narrow-moat Ameriprise Financial.

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Company Profile

Business Description

Spun off from American Express in 2005, Ameriprise Financial has emerged as a major player in the U.S. market for asset and wealth management, with around $1.1 trillion in total assets under management and advisement at the end of 2020. Ameriprise has one of the largest branded advisor networks in the industry, and over 70% of the company's revenue comes from its asset and wealth management segments. Ameriprise has reduced its exposure to insurance with the sale of its auto and home insurance business in 2019 and discontinuing the sale of its proprietary fixed annuities in 2020. Around 90% of the company's pretax earnings are from the United States.

Contact
1099 Ameriprise Financial Center
Minneapolis, MN, 55474
T +1 612 671-3131
Sector Financial Services
Industry Asset Management
Most Recent Earnings Mar 31, 2021
Fiscal Year End Dec 31, 2020
Stock Type Cyclical
Employees 12,300

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