Affiliated Managers Group
AMG
$340.58
-6.98%
Affiliated Managers Group (AMG) is an asset management holding company that acquires majority stakes in boutique investment firms, providing strategic, operational, and distribution support while allowing affiliates to operate independently. With a network managing $882 billion in assets as of March 2026, AMG occupies a unique niche as a platform for specialized asset managers, offering diversification across public equities, liquid alternatives, and private markets. The current investor narrative centers on AMG's strong earnings momentum, driven by robust revenue growth and margin expansion, alongside a favorable valuation that has attracted bullish analyst sentiment. Recent news highlights fund manager positioning shifts, but the stock's 75.5% one-year price gain reflects market confidence in its growth trajectory.…
AMG
Affiliated Managers Group
$340.58
Investment Opinion: Should I buy AMG Today?
Rating: Buy. AMG is a compelling growth-at-a-reasonable-price (GARP) opportunity, with strong earnings momentum and a valuation that does not fully reflect its growth trajectory. The analyst consensus is 'strong buy' with an average target of $412, implying 11.4% upside.
Supporting Evidence: The trailing P/E of 11.45x is a 24% discount to the industry average of 15x, while the forward P/E of 9.05x suggests further earnings growth. Revenue grew 52.66% YoY in Q4 2025, and net margin expanded to 43.43% from 30.9% a year ago. Free cash flow of $978 million TTM provides strong liquidity. The PEG ratio of 0.22 indicates the stock is undervalued relative to its growth rate.
Risks & Conditions: Key risks include market sensitivity (beta 1.12), high debt-to-equity (0.83), and concentration in affiliate performance. This Buy rating would be downgraded to Hold if revenue growth decelerates below 20% YoY or if the P/E expands above 15x without corresponding earnings acceleration. Conversely, an upgrade would require sustained growth above 30% and P/E remaining below 12x. Overall, AMG appears undervalued relative to its growth and profitability.
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AMG 12-Month Price Forecast
AMG's robust revenue growth, expanding margins, and attractive valuation (PEG 0.22) support a bullish stance. The stock's 75.5% one-year gain reflects strong momentum, but the proximity to its 52-week high and market sensitivity warrant medium confidence. Key catalysts include sustained earnings growth and potential multiple expansion. A downgrade to neutral would occur if revenue growth decelerates below 20% or if the P/E exceeds 15x without earnings acceleration.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Affiliated Managers Group's 12-month outlook, with a consensus price target around $412.00 and implied upside of +21.0% versus the current price.
Average Target
$412.00
0 analysts
Implied Upside
+21.0%
vs. current price
Analyst Count
—
covering this stock
Price Range
$330 - $469
Analyst target range
AMG is covered by 7 analysts, with a consensus recommendation of 'strong buy' (mean score 1.43 on a 1-5 scale). The average target price is $412.00, implying 11.4% upside from the current price of $369.83. The distribution shows 0 holds and 0 sells, indicating unanimous bullish sentiment. The target range spans from $330.00 (low) to $469.00 (high), with the high target suggesting 26.8% upside. The low target implies a 10.8% downside, reflecting some uncertainty. The wide spread of $139 between low and high indicates divergent views on the company's future, possibly due to varying assumptions about market conditions and affiliate performance. Recent ratings from TD Cowen, Goldman Sachs, and B of A Securities have been consistently bullish, with upgrades from neutral to buy, reinforcing positive sentiment. The strong buy consensus and upward revisions suggest analysts expect continued earnings growth and potential multiple expansion.
Bulls vs Bears: AMG Investment Factors
AMG presents a compelling bull case driven by accelerating revenue growth (52.66% YoY), expanding margins (net margin 43.43%), and a deeply undervalued PEG ratio of 0.22, supported by unanimous analyst bullishness. However, the stock's proximity to its 52-week high (96.6% of range) and dependence on favorable market conditions introduce downside risk. The single most important tension is whether AMG can sustain its growth momentum—if revenue growth decelerates, the current valuation premium could compress, but if growth continues, the stock has significant upside to the $412 average target. Currently, the bull case has stronger evidence given the fundamental momentum and valuation support.
Bullish
- Strong Revenue Growth: Q4 2025 revenue surged 52.66% YoY to $800.4 million from $524.3 million, driven by strong affiliate performance and market appreciation. This acceleration signals robust organic growth and market share gains.
- Undervalued on PEG Ratio: With a PEG ratio of 0.22, the stock trades at a deep discount to its earnings growth rate, suggesting significant undervaluation. This implies the market is not fully pricing in the company's growth trajectory.
- Expanding Profit Margins: Gross margin improved from 54.45% in Q4 2024 to 83.33% in Q4 2025, while net margin reached 43.43%, reflecting strong operating leverage and cost discipline. This margin expansion enhances earnings power.
- Strong Free Cash Flow Generation: Trailing twelve-month free cash flow stands at $978 million, providing ample liquidity for reinvestment, debt reduction, and shareholder returns. This cash flow supports a sustainable growth model.
Bearish
- Near 52-Week High, Limited Upside: At $369.83, the stock trades at 96.6% of its 52-week high of $382.75, leaving only 3.5% room to that resistance. This proximity increases the risk of a pullback if momentum stalls.
- Dependence on Market Conditions: AMG's revenue is tied to asset values and performance fees, making it sensitive to market downturns. A 10% market correction could reduce AUM and fee income, pressuring earnings.
- High Debt-to-Equity Ratio: With a debt-to-equity ratio of 0.83, the company carries significant leverage, which could strain cash flows in a rising interest rate environment. Interest expense of $34.7 million in Q4 2025 is material.
- Concentration Risk in Affiliates: AMG's performance depends on a network of boutique firms; underperformance or loss of key affiliates could materially impact revenue. The top affiliates represent a significant portion of AUM.
AMG Technical Analysis
AMG is in a sustained uptrend, with a 1-year price change of +75.5% and the current price of $369.83 trading at 96.6% of its 52-week range ($200.00–$382.75). This positioning near the high end suggests strong momentum and bullish sentiment, though it also implies the stock may be approaching overbought territory. The stock has outperformed the S&P 500's 1-year return of 18.35% by a wide margin, indicating significant relative strength. Short-term momentum is accelerating, with a 1-month change of +3.98% and a 3-month change of +25.37%, both outpacing the S&P 500's respective returns of 0.31% and 4.67%. The 1-month relative strength of 3.67% confirms continued buying pressure, while the 3-month relative strength of 20.70% shows the trend is strengthening. This divergence from the broader market suggests AMG is experiencing company-specific catalysts driving outperformance. Key support lies near the 52-week low of $200.00, while resistance is at the 52-week high of $382.75. A breakout above $382.75 would signal a continuation of the uptrend, potentially targeting new highs. The stock's beta of 1.12 indicates slightly higher volatility than the market, meaning it tends to amplify market moves by about 12%, which is moderate for a financial stock.
Beta
1.12
1.12x market volatility
Max Drawdown
-19.7%
Largest decline past year
52-Week Range
$200-$383
Price range past year
Annual Return
+64.8%
Cumulative gain past year
| Period | AMG Return | S&P 500 |
|---|---|---|
| 1m | -3.5% | +0.2% |
| 3m | +13.0% | +5.2% |
| 6m | +3.3% | +8.6% |
| 1y | +64.8% | +19.0% |
| ytd | +17.9% | +9.7% |
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AMG Fundamental Analysis
Revenue growth has been robust, with Q4 2025 revenue of $800.4 million representing a 52.66% YoY increase from $524.3 million in Q4 2024. This acceleration is driven by strong performance across affiliates, with net income surging to $347.6 million from $162.1 million a year earlier. The trailing twelve-month free cash flow of $978 million provides ample liquidity for reinvestment and shareholder returns. Profitability has improved dramatically, with net income of $347.6 million in Q4 2025 versus $162.1 million in Q4 2024, and gross margin expanding to 83.33% from 54.45% a year ago. Operating margin rose to 38.54% from 33.55%, reflecting operating leverage and cost discipline. The net margin of 43.43% is exceptionally high for the asset management industry, indicating strong earnings power. The balance sheet is healthy, with a debt-to-equity ratio of 0.83 and a current ratio of 1.34, suggesting adequate liquidity. Free cash flow of $265.4 million in Q4 2025 comfortably covers capital expenditures of $1.9 million, and the company generated $977 million in free cash flow over the trailing twelve months. Return on equity of 22.13% is strong, indicating efficient use of shareholder capital.
Quarterly Revenue
$800400000.0B
2025-12
Revenue YoY Growth
+52.7%
YoY Comparison
Gross Margin
83.3%
Latest Quarter
Free Cash Flow
$977999999.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
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Valuation Analysis: Is AMG Overvalued?
Since net income is positive, the primary valuation metric is the P/E ratio. The trailing P/E of 11.45x and forward P/E of 9.05x imply that the market expects earnings growth, with the forward multiple reflecting a 21% discount to trailing. This gap suggests analysts anticipate continued earnings expansion. Compared to the asset management industry average P/E of approximately 15x, AMG trades at a 24% discount on a trailing basis, which may be justified by its unique business model and growth profile. However, the PEG ratio of 0.22 indicates the stock is undervalued relative to its earnings growth rate. Historically, AMG's trailing P/E of 11.45x is near the lower end of its 5-year range of roughly 5x to 17x, suggesting the stock is not overvalued. The current multiple is below the 2021 peak of around 14x, implying room for multiple expansion if growth continues. The price-to-book ratio of 2.54x is also below the 5-year average of about 2.8x, reinforcing the value proposition.
PE
11.4x
Latest Quarter
vs. Historical
Mid-Range
5-Year PE Range 5x~15x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
6.9x
Enterprise Value Multiple
Investment Risk Disclosure
Financial & Operational Risks: AMG's debt-to-equity ratio of 0.83 indicates moderate leverage, with Q4 2025 interest expense of $34.7 million consuming a portion of operating income. While free cash flow of $978 million TTM provides coverage, a sustained rise in interest rates could increase borrowing costs. The company's revenue is heavily dependent on asset values and performance fees, making it vulnerable to market downturns—a 10% market decline could reduce AUM and fee income. Additionally, the net margin of 43.43% is high but may be unsustainable if market conditions deteriorate or if affiliate performance weakens.
Market & Competitive Risks: AMG trades at a trailing P/E of 11.45x, a 24% discount to the asset management industry average of 15x, but this discount could widen if growth disappoints. The stock's beta of 1.12 indicates slightly higher volatility than the market, amplifying downside in a bear market. Competitive pressures from passive investing and low-cost ETFs could erode market share for active managers, impacting AMG's affiliates. Recent news of a major fund exiting Sealed Air highlights shifting investor sentiment, though not directly related to AMG.
Worst-Case Scenario: A severe market downturn (e.g., 20%+ correction) combined with underperformance at key affiliates could trigger a sharp decline in revenue and earnings. In such a scenario, the stock could fall to its 52-week low of $200, representing a 45.9% loss from the current price of $369.83. This downside is consistent with the stock's historical max drawdown of -19.72% but could be worse given current elevated valuations relative to the low.
FAQ
The key risks include: 1) Market sensitivity: With a beta of 1.12, AMG amplifies market moves, and a 10% market decline could reduce AUM and fee income. 2) Financial leverage: A debt-to-equity ratio of 0.83 means interest expense ($34.7 million in Q4 2025) could strain cash flows if rates rise. 3) Affiliate concentration: Performance depends on a network of boutique firms; underperformance or loss of a key affiliate could materially impact revenue. 4) Valuation risk: The stock trades near its 52-week high, leaving limited upside if growth decelerates. The most severe risk is a market correction combined with affiliate outflows, which could drive the stock to $200 (45.9% downside from current price).
The 12-month forecast is positive, with a base case target of $369-$412 (50% probability) assuming sustained mid-20% revenue growth and stable margins. The bull case (30% probability) targets $412-$469, driven by stronger market conditions and multiple expansion. The bear case (20% probability) sees the stock falling to $200-$330 if a market downturn or affiliate issues slow growth. The most likely scenario is the base case, with the stock reaching the average analyst target of $412, implying 11.4% upside. Key assumptions include continued revenue growth above 20% YoY and no major market correction. The AI assessment is bullish with medium confidence, citing strong fundamentals but acknowledging market sensitivity.
AMG appears undervalued based on multiple metrics. The trailing P/E of 11.45x is below the industry average of 15x, and the forward P/E of 9.05x suggests earnings growth is expected. The PEG ratio of 0.22 is well below 1.0, indicating the stock is cheap relative to its growth rate. Historically, the trailing P/E is near the lower end of its 5-year range (5x-17x), and the price-to-book ratio of 2.54x is below the 5-year average of 2.8x. The market is pricing in a discount, possibly due to concerns about market sensitivity and affiliate concentration. However, given the strong revenue growth (52.66% YoY) and margin expansion, the valuation seems attractive. The stock is likely undervalued relative to its fundamentals.
AMG appears to be a good buy for growth-oriented investors with a moderate risk tolerance. The stock trades at a trailing P/E of 11.45x, a 24% discount to the asset management industry average of 15x, and has a PEG ratio of 0.22, indicating undervaluation relative to its earnings growth. Analyst consensus is 'strong buy' with an average target of $412, implying 11.4% upside. However, the stock is near its 52-week high, limiting short-term upside, and is sensitive to market conditions (beta 1.12). For long-term investors, the strong free cash flow ($978 million TTM) and margin expansion provide a solid foundation. The biggest downside risk is a market correction that could reduce AUM and earnings, potentially driving the stock to $200 (52-week low). Overall, it is a good buy for those who can tolerate volatility and have a 12-month horizon.
AMG is better suited for long-term investment (12+ months) given its growth profile and valuation. The stock has a beta of 1.12, indicating moderate volatility, and its 75.5% one-year gain shows strong momentum but also implies potential for pullbacks. The low dividend yield (0.012%) means returns are driven by capital appreciation, which requires time for earnings growth to materialize. Short-term traders may find opportunities around earnings announcements or market swings, but the stock's proximity to its 52-week high limits short-term upside. For long-term investors, the PEG ratio of 0.22 and strong free cash flow provide a margin of safety. A minimum holding period of 12 months is recommended to allow the growth story to play out.