QUOTE AND NEWS
The Hindu Business Line  Mar 12  Comment 
South African cricket captain AB de Villiers continued to script statistical history at the ongoing World Cup as he today entered the top-10 of all-time scorers’ list besides breaking the tourname...
The Economic Times  Mar 10  Comment 
'AB Nuvo Ltd is a 'SELL' call with a target of Rs 1,620 and a stop loss of Rs 1,648'
The Economic Times  Mar 9  Comment 
AB Nuvo Ltd is a 'SELL' call with a target of Rs 1,640 and a stop loss of Rs 1,711.
The Economic Times  Mar 5  Comment 
'AB Nuvo Ltd is a 'SELL' call with a target of Rs 1,675 and a stop loss of Rs 1,736'
Benzinga  Mar 2  Comment 
Citi raised its price target on AllianceBernstein Holding LP (NYSE: AB) Monday from $32 to $34 and maintained a Buy rating following meetings with management. Analysts led by William R. Katz suggested the company is "sitting on a ‘disruptive...
Wall Street Journal  Feb 27  Comment 
Anheuser-Busch InBev said economic recovery in the U.S. helped offset the impact of a stronger dollar that hurt sales elsewhere in the company’s global beer empire, pushing up profits during the fourth quarter.
Forbes  Feb 26  Comment 
In a bizarre juxtaposition of irrational fears, a New York State legislator has introduced a bill to ban GMOs in vaccines. The bill, NY AB 1706, is apparently not a hoax but was introduced by assembly member Thomas J. Abinanti, who has passed...
Benzinga  Feb 26  Comment 
Analysts at Bank of America upgraded AllianceBernstein Holding L.P. (NYSE: AB) from Buy to Neutral. AllianceBernstein Holding shares have gained 14.56% over the past 52 weeks, while the S&P 500 index has surged 14.00% in the same...
Wall Street Journal  Feb 26  Comment 
Anheuser-Busch InBev said economic recovery in the U.S. helped offset the impact of a stronger dollar that hurt sales elsewhere in the company’s global beer empire, pushing up profits during the fourth quarter.




 

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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