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Dec 31, 2019
WisdomTree Investments Inc Q4 2019 Earnings Report
WisdomTree Investments Inc. reported mixed results for Q4 2019 with diluted EPS of $0.02 ($0.06 as adjusted) and net income of $4.3 million ($10.11 million as adjusted).
Key Takeaways
WisdomTree Investments reported a net income of $4.3 million and diluted EPS of $0.02 for Q4 2019. The company's ending AUM increased by 6.1% to $63.6 billion, driven by market appreciation and net inflows. Operating revenues increased by 1.8% to $68.9 million, primarily due to higher average AUM of U.S. listed products.
Ending AUM increased by 6.1% to $63.6 billion due to market appreciation and net inflows.
Net inflows were $368 million ($560 million excluding HEDJ/DXJ), driven by U.S. equity, fixed income, and emerging markets products.
Operating revenues increased by 1.8% to $68.9 million due to higher average AUM of U.S. listed products.
The company is pursuing an exit from its $58 million investment in AdvisorEngine Inc. and estimates a non-cash impairment charge of $22.0 million to $30.0 million.
Forward Guidance
WisdomTree is focused on capitalizing on tailwinds, driving operating efficiencies, and investing in industry innovation in 2020.
Positive Outlook
- Funds' performance track records remain excellent.
- Adoption of model portfolios by advisors is accelerating.
- Strategic investment in Securrency, Inc. for blockchain integration.
- Collaboration with Professor Jeremy Siegel to design and launch two model portfolios.
- Positive net flows in four of the past five quarters.
Challenges Ahead
- Pursuing an exit from AdvisorEngine Inc. investment, expecting a non-cash impairment charge.
- Operating expenses increased due to costs associated with the Bitcoin ETP launch and Brexit preparations.
- Non-cash loss on revaluation of deferred consideration.
- Effective income tax rate differs from the federal statutory rate.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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