Looking back on custody bank stocks’ Q2 earnings, we examine this quarter’s best and worst performers, including Affiliated Managers Group (NYSE: AMG) and its peers.

Custody banks safeguard financial assets and provide services like settlement, accounting, and regulatory compliance for institutional investors. Growth opportunities stem from increasing global assets under custody, demand for data analytics, and blockchain technology adoption for settlement efficiency. Challenges include fee pressure from large clients, substantial technology investment requirements, and competition from both traditional players and fintech firms entering the space.

The 13 custody bank stocks we track reported a mixed Q2. As a group, revenues were in line with analysts’ consensus estimates.

Thankfully, share prices of the companies have been resilient as they are up 5.4% on average since the latest earnings results.

Affiliated Managers Group (NYSE: AMG)

Using a partnership approach that preserves entrepreneurial culture at its portfolio companies, Affiliated Managers Group (NYSE: AMG) is an investment firm that acquires stakes in boutique asset management companies while allowing them to maintain operational independence.

Affiliated Managers Group reported revenues of $493.2 million, down 1.4% year on year. This print fell short of analysts’ expectations by 2.8%. Overall, it was a slower quarter for the company with some shareholders anticipating a better outcome.

Interestingly, the stock is up 10.7% since reporting and currently trades at $233.05.

Read our full report on Affiliated Managers Group here, it’s free.

Best Q2: Voya Financial (NYSE: VOYA)

Originally spun off from Dutch financial giant ING in 2013 and rebranded with a name suggesting "voyage," Voya Financial (NYSE: VOYA) provides workplace benefits and savings solutions to U.S. employers, helping their employees achieve better financial outcomes through retirement plans and insurance products.

Voya Financial reported revenues of $1.9 billion, up 2.2% year on year, outperforming analysts’ expectations by 13.5%. The business had a stunning quarter with an impressive beat of analysts’ AUM estimates and a beat of analysts’ EPS estimates.

Voya Financial pulled off the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 14.4% since reporting. It currently trades at $77.62.

Is now the time to buy Voya Financial? Access our full analysis of the earnings results here, it’s free.

Slowest Q2: Franklin Resources (NYSE: BEN)

Operating under the widely recognized Franklin Templeton brand since 1947, Franklin Resources (NYSE: BEN) is a global investment management organization that offers financial services and solutions to individuals, institutions, and wealth advisors worldwide.

Franklin Resources reported revenues of $1.59 billion, down 3.7% year on year, falling short of analysts’ expectations by 18.8%. It was a softer quarter as it posted a significant miss of analysts’ EPS estimates.

Franklin Resources delivered the weakest performance against analyst estimates in the group. Interestingly, the stock is up 7.4% since the results and currently trades at $25.74.

Read our full analysis of Franklin Resources’s results here.

Ameriprise Financial (NYSE: AMP)

Founded in 1894 and spun off from American Express in 2005, Ameriprise Financial (NYSE: AMP) provides financial planning, wealth management, asset management, and insurance products to help individuals and institutions achieve their financial goals.

Ameriprise Financial reported revenues of $4.34 billion, up 3.9% year on year. This print met analysts’ expectations. Zooming out, it was a mixed quarter as it also recorded a narrow beat of analysts’ EPS estimates but a slight miss of analysts’ Asset Management segment estimates.

The stock is down 4.5% since reporting and currently trades at $511.90.

Read our full, actionable report on Ameriprise Financial here, it’s free.

BNY Mellon (NYSE: BK)

Tracing its roots back to 1784 when it was founded by Alexander Hamilton, BNY Mellon (NYSE: BK) is a global financial institution that provides asset servicing, wealth management, and investment services to institutions, corporations, and high-net-worth individuals.

BNY Mellon reported revenues of $5.03 billion, up 9.4% year on year. This number topped analysts’ expectations by 3.9%. It was a very strong quarter as it also logged a beat of analysts’ EPS estimates.

The stock is up 10.7% since reporting and currently trades at $105.40.

Read our full, actionable report on BNY Mellon here, it’s free.

Market Update

As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.

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