Buy the Dip in These Top Financial Management Stocks: AAMI, AB

Although September has historically been one of the underperforming months for the stock market and can be prone to panic selling, this can create opportunities for seasoned investors or those willing to stretch their risk tolerance, with two finance stocks worth considering on a recent dip below their 52-week highs being Acadian Asset Management AAMI and AllianceBernstein AB.

Furthermore, this September could be different as the expectation of a rate cut is on the horizon and bodes well for financial investment management firms like Acadian and AllianceBernstein. To that point, lower rates can ease credit risk while reducing borrowing costs and improving asset prices, as market activity is likely to increase.

Financial Investment Leadership

Known for their quantitative analysis and global market insights, Acadian and AllianceBernstein are two financial management firms that excel in investment solutions for institutional investors.

Acadian’s edge lies in the ability to turn massive datasets into actionable strategies with expertise on emerging markets. Beyond equities, Acadian has expanded into alternative assets and credit strategies, applying its systematic approach to diverse asset classes.

Similarly, AllianceBernstein emphasizes differentiated investment insights outside of equity trading with an expertise in risk management and insurance services. Operating in major markets worldwide, AllianceBernstein’s solutions also go beyond traditional institutional investment management strategies to include annuity-based income generation and retirement planning, among other services for private wealth clients. 

Acadian & AllianceBernstein’s Record AUM

Highlighting their financial investment leadership and ability to further capitalize if rate cuts are ahead, is that both firms are sitting at record peaks in assets under management (AUM), which has been attributed to strong global equity inflows and enhanced equity mandates.  

At the end of Q2, Acadian reported a record AUM of $151.1 billion, with AlllianceBernstein’s AUM at an all-time high of $829 billion.

Positive EPS Revisions

Most indicative that buying the dip in Acadian and AllianceBernstein stock could be advantageous is that they are benefiting from a positive trend of earnings estimate revisions.

Acadian especially stands out, as over the last 60 days, its fiscal 2025 and FY26 EPS estimates have surged 17% and 26%, respectively. More intriguing, Acadian’s annual earnings are now expected to soar 35% this year and are projected to spike another 21% in FY26 to $4.50 per share.

As for AllianceBernstein, FY25 EPS estimates are up 4% in the last two months, with FY26 revisions rising 7%. Plus, AllianceBernstein’s bottom line is now expected to expand 2% in FY25 and is forecasted to stretch another 11% next year to $3.69 per share.

Attractive P/E Valuations

Magnifying their increased profitability is that Acadian and AllianceBernstein stock trade at reasonable forward P/E multiples of 11X, offering a steep discount to the broader Zacks finance sectors' 19X and the S&P 500’s 24X.  

Bottom Line

Attributed to the very pleasant trend of positive earnings estimate revisions, Acadian Asset Management stock sports a Zacks Rank #1 (Strong Buy) and may be poised for a sharp rebound after falling from its 52-week high of $51 a share. Meanwhile, AllianceBernstein stock lands a Zacks Rank #2 (Buy), making the argument for a retrace to its one-year peak of $43 a share while offering a very generous 7.71% annual dividend yield.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research