QUOTE AND NEWS
Forbes  Nov 24  Comment 
On 11/26/14, BCE Inc.'s Series AB Preferred Shares (Toronto: BCE-PRB) will trade ex-dividend, for its monthly dividend of $0.0625, payable on 12/12/14. As a percentage of BCE.PRB's recent share price of $22.25, this dividend works out to...
OilVoice  Nov 20  Comment 
During October 2014 the Joint Activity JA led by Misen Energy AB publ Misen produced a total of 55.1 million cubic meters mmcm of natural gas 2.5 thousand tons ktons of gas condensate and
The Economic Times  Nov 20  Comment 
"AB Nuvo Ltd is a 'SELL' call with a target of Rs 1752 and a stop loss of Rs 1791."
Wall Street Journal  Nov 20  Comment 
Anheuser-Busch InBev NV confirmed Wednesday it is cutting jobs and consolidating its sales division in the U.S. after the world’s largest brewer posted weak third-quarter results in its largest market.
OilVoice  Nov 18  Comment 
Lundin Petroleum AB OMXLUPE has completed the Kitabu1 well located in Blocks SB307SB308 offshore Sabah Malaysia. Objectives of the Kitabu1 well were Miocene aged turbidite sands of similar ag
newratings.com  Nov 17  Comment 
STOCKHOLM (dpa-AFX) - Swedish apparel retailer Hennes & Mauritz AB or H&M (HNNMY.PK, HMRZF.PK, HEN.L) Monday reported growth in sales for the month of October, with increase in number of stores at the period end. Total sales for the month,...
The Hindu Business Line  Nov 15  Comment 
Andhra Bank has launched two new savings schemes for children. The schemes, AB Little Stars for children aged between 10 and 14 years, and AB Teens for those who are in the age group of 1...




 

AllianceBernstein L.P. (NYSE: AB) is an asset management firm with over $480 billion in assets under management (AUM). Over 97% of AB's investments are in stocks and bonds.

The world's second largest insurance company AXA (headquartered in France) owns over 60% stake of AB.[1] The company's foreign ownership lets it avoid the 35% federal corporate tax, and instead pay minimal dues of 7.5% for an unincorpated business. However, AB's partnership status also means that it must distribute nearly all of its earnings to its fund holders, limiting the growth potential of the firm.

More than half of AB's AUM is invested abroad, and the international focus of the company helped to shield the company from the 2007 credit crunch.

Corporate Overview

Business Financials

In 2009, AB posted total revenues of $2.94 billion, a slight decrease from its 2008 total revenues of $3.57 billion. As a result of the decrease in revenues, AB's net income was adversely affected. Between 2008 and 2009, AB's net income declined from $244.7 million in 2008 to $167 million in 2009.

Business Segments

AB's AUM and revenue fall under the following categories:

Institutional Investment Services (60.5% of 2009 AUM)[2]

Institutional Investment Services refer to products and services provided for corporate or governmental investors using diversified investments into instruments like hedge funds, mutual funds, and investment trusts. At the end of 2009, total AUM for this segment was $300 billion.[2]

Retail Services (24.4% of 2009 AUM)[2]

Retail Services are designed for the individual investor as their funds are spread among a variety of investment vehicles like those of AB's Institutional Investment Services. Such vehicles include mutual funds and closed end funds, which offer a set number of shares for its funds. At the end of 2009, this segment had total AUM of $120.7 billion.[2]

Private Client Services (15.1% of 2009 AUM)

This segment includes AB's investment interactions with private clients. At the end of 2009, this segment had total AUM of $74.8 billion.[2]

Key Trends and Forces

Strong international exposure boosts AB business

AllianceBernstein is still largely an American firm, as 60% of its clients live in the U.S.[3] However, both individual and institutional business are becoming more and more international. In fact, the company invested 40% ($320 billion)[4] of their AUM overseas and 61% of their investment services ($489 billion)[3] were for clients (mainly institutional) outside the US. International markets are providing key business for AB, especially as the firm pushes through the 2007 credit crunch.

Competition

AllianceBernstein competes with many firms throughout the greater financial services industry. Some of its direct competitors include BlackRock (BLK), Legg Mason (LM), Eaton Vance (EV), and T. Rowe Price Group (TROW).

References

  1. AB 2007 10-K pg. 18  
  2. 2.0 2.1 2.2 2.3 2.4 AB 10-K 2009 Item 1 Pg. 6
  3. 3.0 3.1 AB 2007 10-K pg. 3-4  
  4. 2008 AB Conference Call
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