- Leading asset manager T. Rowe Price has continued to struggle, given its exposure to equity markets and weak investor sentiment.
- However, we gleaned that TROW has likely formed its long-term bottom in June, despite the high pessimism in the market. Hence, we view the recent pullback constructively.
- We discuss why investors should capitalize on its near-term weakness to add more positions, undergirded by robust dividend yields.
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Leading asset manager T. Rowe Price Group, Inc. (NASDAQ:TROW) stock has been hammered since its September 2021 highs. Given its exposure to equity-based AUM, investors shouldn’t be surprised as the equity bear market has inflicted tremendous pain on investors. Furthermore, fixed income was also battered in 2022, as a hawkish Fed continued to pile on the misery for bond investors with rapid rate hikes to combat elevated inflationary pressures.
As a result, 2022 has been a year for TROW investors to forget, as they battled unsuccessfully against market forces. In addition, investors repositioned their portfolios, coupled with negative investor sentiment driving massive outflows, exacerbated the challenges for T. Rowe.
However, our analysis suggests that TROW has likely formed its long-term bottom in June. Therefore, we view the recent pullback from its summer rally as healthy and appropriate for investors to add more positions.
As such, we rate TROW as a Buy.