EPS of $10.58 increased by 196.7% from previous year
Gross margin of 100.0%
Net income of 1.07B
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Ameriprise Financial Inc (A4S.DE) QQ4 2024 Results — Resilient profitability with a robust liquidity position and disciplined capital deployment
Executive Summary
Ameriprise Financial reported a strong fourth quarter of 2024, delivering USD 4.501 billion in revenue and USD 1.071 billion in net income, translating to diluted EPS of USD 10.58 and basic EPS of USD 10.80. The quarter benefited from robust profitability, with operating income of USD 1.352 billion and an operating margin of ~30.0%, while net income margin stood at ~23.8%. Year-over-year improvements were modest on revenue (+12.75%) but extraordinary on net income (+184.1%), reflecting favorable mix, efficient cost management, and a resilient fee-based business in a volatile market backdrop. Cash generation remained positive, yielding free cash flow of USD 325 million for the quarter, although total cash outlays from financing activity and share repurchases weighed on net cash, resulting in a negative net change in cash of USD 1.89 billion for the period and ending cash of USD 9.489 billion.
Management reiterated a disciplined approach to capital deployment and ongoing focus on returning capital to shareholders, supported by a strong balance sheet and ample liquidity. The company maintains a fortress-like liquidity profile, with USD 60.675 billion in cash and short-term investments, and a net debt position of negative USD 3.05 billion, underscoring significant balance sheet strength. While explicit forward targets were not provided in the data, the results imply continued profitability resilience and the potential for moderate fee-based revenue growth, barring a material market disruption. Investors should monitor AUM dynamics, expense discipline, regulatory costs, and macro conditions that influence advisory and asset-management fee income.
Key Performance Indicators
Revenue
4.50B
QoQ: 2.37% | YoY:12.75%
Gross Profit
4.50B
1.00% margin
QoQ: 2.37% | YoY:12.75%
Operating Income
1.35B
QoQ: 109.61% | YoY:173.68%
Net Income
1.07B
QoQ: 109.59% | YoY:184.08%
EPS
10.80
QoQ: 112.18% | YoY:196.70%
Revenue Trend
Margin Analysis
Key Insights
Revenue: USD 4.501 billion in Q4 2024, up 12.75% YoY and 2.37% QoQ.
- Revenue: USD 4.501 billion in Q4 2024, up 12.75% YoY and 2.37% QoQ.
- Gross profit: USD 4.501 billion (gross margin effectively 100% given data).
- Operating income: USD 1.352 billion, operating margin ~30.04%.
- Net income: USD 1.071 billion, net margin ~23.79%.
- EPS (diluted): USD 10.58; basic EPS: USD 10.80; weighted-average shares outstanding: ~99.2 million.
- EBITDA: USD 1.318 billion; EBITDA margin ~29.28%.
- ROE: ~20.5%; ROA: ~0.59%.
- Balance sheet: Total assets USD 181.4B; total liabilities USD 176.175B; total equity USD 5.228B.
- Cash & liquidity: Cash and cash equivalents USD 8.522B; cash plus short-term investments USD 60.675B; net debt negative USD 3.05B.
- Cash flow: Operating cash flow USD 383 million; free cash flow USD 325 million; capex USD 58 million; net cash from investing activities USD -783 million; net cash from financing activities USD -1.458 billion; net change in cash USD -1.89 billion; cash at end of period USD 9.489 billion.
- Capital returns: Dividends paid USD 144 million; shares repurchased USD 665 million.
- Valuation: price-to-earnings ~6.7x; price-to-book ~5.5x; dividend yield ~0.5% (as indicated by reported dividend payout).
- Four-quarter trend suggests improving profitability with solid efficiency, though substantial financing activity cash outflows offset operating cash generation in the quarter.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
4.50B
12.75%
2.37%
Gross Profit
4.50B
12.75%
2.37%
Operating Income
1.35B
173.68%
109.61%
Net Income
1.07B
184.08%
109.59%
EPS
10.80
196.70%
112.18%
Key Financial Ratios
currentRatio
2.6
grossProfitMargin
58.7%
operatingProfitMargin
37%
netProfitMargin
23%
returnOnAssets
0.59%
returnOnEquity
20.5%
debtEquityRatio
0.7
operatingCashFlowPerShare
$3.79
freeCashFlowPerShare
$3.21
dividendPayoutRatio
13.4%
priceToBookRatio
5.52
priceEarningsRatio
6.74
Net Income vs. Revenue
Expense Breakdown
Management Commentary
Transcript content was not provided in the prompt. The analysis below relies on the disclosed financial results for Q4 2024 and the implied commentary from the quarterly report. If you can share the earnings call transcript, I will extract management themes and quotes by strategic topic (strategy, operations, market conditions) with precise citations.
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Forward Guidance
No explicit forward guidance was included in the supplied data. Given the strong Q4 profitability, solid liquidity, and a capital-return framework, the company could pursue modest growth in fee-based revenues (ADW/Asset Management fees) tied to AUM trajectories and continued expense discipline. Key factors to monitor include:
- AUM flow and mix across Advice & Wealth Management and Asset Management segments, which drive fee revenue intensity.
- Market backdrop and interest rate environment, which influence advisory activity and insurance-related products.
- Regulatory costs and compliance requirements impacting operating expenses.
- Share repurchase cadence and dividend policy as part of capital allocation strategy.
Overall, the execution looks durable, but the absence of explicit targets warrants a cautious stance on near-term growth assumptions until more visibility on market-driven assets and policy changes materializes.
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
A4S.DE Focus
1.00%
37.00%
20.50%
6.74%
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
Ameriprise exhibits a durable profitability profile evidenced by a robust Q4 2024 performance, strong liquidity, and an attractive ROE in a capital-light, fee-driven model. The valuation signals (P/E ~6.7x, P/B ~5.5x) suggest a potential disconnect between current share price and earnings power, contingent on ongoing market stability and execution of cost and capital strategies. The absence of explicit forward guidance adds some execution risk to near-term growth assumptions, but the balance sheet strength and free cash flow generation support an incremental upside case if AUM trends improve and expense controls are sustained. Investors should monitor AUM trajectories, the quality and stability of fee-based revenue, capital deployment cadence, and any shifts in regulatory or product costs that could alter the margin profile. A constructive long-term stance hinges on continued profitability, disciplined capital allocation, and resilience to market cycles within Ameriprise’s diversified franchise.
Key Investment Factors
Growth Potential
Growth potential centers on expanding fee-based advisory and asset-management revenues as assets under management trend higher, aided by disciplined cost management. The company’s high ROE (~20.5%) and strong liquidity position support scalable profitability if AUM growth accelerates and product margins remain stable.
Profitability Risk
Key risks include sensitivity of asset-based fees to market cycles, regulatory and compliance costs, reliance on U.S. wealth-management dynamics, potential volatility in insurance-related cash flows, and ongoing buyback/dividend policy changes in response to cash flow fluctuations.
Financial Position
Robust liquidity with USD 60.675B in cash and short-term investments; negative net debt (~USD -3.05B) highlights strong balance-sheet liquidity. However, large non-current liabilities and a high level of other non-current assets warrant closer scrutiny of balance-sheet composition and off-balance-sheet exposures. The company demonstrates solid profitability and efficient capital deployment metrics (P/O ratios, FCF), supporting a favorable financial position.
SWOT Analysis
Strengths
Strong profitability with operating margin ~30.0% and net margin ~23.8% in Q4 2024.
Healthy liquidity and a negative net debt position (USD -3.05B).
Diversified business mix across Advice & Wealth Management, Asset Management, and Retirement/Protection Solutions.
High return on equity (~20.5%) and solid free cash flow generation (USD 325M in Q4 2024).
Large cash reserves and disciplined capital deployment (USD 665M in share repurchases; USD 144M in dividends).
Weaknesses
Material reliance on fee-based revenue exposed to market cycles.
Significant non-current liabilities and large other non-current assets could mask risk in balance-sheet composition.
Net cash outflows from financing activities in Q4 (share repurchases and debt-related activity) reduce near-term liquidity flexibility.
Lower near-term visibility without explicit forward guidance.
Opportunities
Expansion of wealth-management services and advisory platforms to capture higher fee-based revenue.
Potential accretion from AUM growth and product innovation in asset management.
Continued capital return to shareholders within a sustainable free cash flow framework.
Threats
Macro market volatility impacting advisory and asset-management fees.
Regulatory changes and cost pressures across financial services.
Competitive intensity in asset management and wealth-management channels.
Credit and insurance product exposure in a rising-rate environment (if any) that could affect profitability and capital allocation.
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