APAM — Artisan Partners Asset Management Inc

Deep-value: APAM — Artisan Partners Asset Management Inc. (NYSE)

Analysis 2026-09-18 · reference price … · primary sources: 10-K FY2025 (filed 2026-02-20), 10-Q Q1–Q3 2025, XBRL companyfacts via the 2026-09-18 data pack, research brief from 2026-09-18.

Executive summary (1 page: thesis, estimated value, verdict)

Artisan Partners is an active-management shop with … AUM (August 2026), built as a federation of 12 autonomous investment franchises, which earns a weighted-average fee of ~68 basis points and distributes almost all of what it earns. In 2025 it produced … of revenue, … of adjusted operating profit (35.3% margin) and … of adjusted net income, of which it distributed ~… to all economic holders — a ~98% payout ratio. It isn’t a company that compounds capital; it’s a pipe with a toll.

The thesis, in one sentence: at … you’re paying roughly the intrinsic value of a pipe with a 9.5% dividend yield, whose flow is a direct function of the level of world stock markets (beta 1.66) and which organically loses 7… of assets a year; you win if markets rise, you lose twice over if they don’t.

The correction that changes everything. The market cap that yfinance and the tracker use — … on 70.9 mil. shares — is wrong. APAM is an “Up-C” structure: alongside the 70,530,755 Class A shares, there are 10,055,405 Artisan Partners Holdings partnership units held by employee-partners and former partners (mirrored by 1,137,929 Class B shares and 8,917,476 Class C shares, with no economic rights at the APAM Inc. level but with pro-rata participation in Holdings distributions) — 10-K FY2025, cover page and balance sheet. The company itself reports 81.1 mil. “adjusted shares” (FY2025). The real economic market cap at … is therefore …, not … — 14.6% higher. Every per-share yield in the tracker (FCF yield 10.0%, P/E 8.72) is ~13% too favorable.

The earnings figure. Over the last four reported quarters (Q3 2025 – Q2 2026), adjusted net income per adjusted share is 1.02 + 1.26 + 0.87 + 0.94 = …, i.e. ~… After the ~… Global Value rebalancing expected in September 2026 and the liquidation of the U.S. Value line, the prospective normalized base is ~… — the figure I used as owner earnings. It isn’t a margin × revenue estimate: it’s confirmed by three independent paths (the cash bridge from the statement of cash flows, the company’s own definition of “cash generated,” and the actual cash amount distributed), all of which fall in the …–333 mil. range.

The estimated value. Triangulation across five models (DCF FCFE bear/base/bull, EPV Greenwald, Graham Number) gives an MOS range of ** … … … (median) … …. Monte Carlo over 20,000 scenarios on the same assumptions (OE 320, g1 1%, r …%, gt 0%, net debt 0, 81.3 mil. shares) gives a median intrinsic value of … versus a price of … — median MOS ** …, undervaluation probability ** …**, probability of a margin of safety above 30% only …%. In other words: at today’s price it’s a coin flip.

Verdict: MONITOR — don’t buy at … Not because the business is bad (the 35.3% adjusted margin, the 0.4× leverage, and the 60.3× interest coverage are excellent), but because the price offers no margin. Expected total return ≈ dividend yield (9.5%) + growth (≈0%) ≈ 9.5%, i.e. below the …% cost of equity that a beta of 1.66 demands. The price that would give a 25% margin of safety versus the base DCF (…) is …–29 — a level last touched in March 2023 (24.14) and October 2022 (20.63). RSI 14 at 27.5 and the position below EMA50 and EMA200 say the market is already reacting to the September 10, 2026 rebalancing news; the drop from 42.57 (August) to … (September), … in a month, is exactly that message. It isn’t enough yet.

The risk that could invalidate even the neutral scenario: 50.7% of AUM (54.0 bn Int’l Value Group + 37.3 bn Global Value) sits in two international value teams that just had an exceptional cycle (… and … investment return on average assets in 2025, respectively). In a model explicitly built as a “house for investment talent,” with autonomous franchises and franchise capital invested in their own strategies, half the firm has legs.