Ameriprise's Interest-Rate-Related Revenue Buffering Effect of Declining Client Assets

Ameriprise reported net income of $548 million, or $4.86 per diluted share, on $3.5 billion of net revenue for the third quarter. On a company-provided adjusted operating basis that excludes the effect of changes in interest rates on some of its products, Ameriprise reported pro forma operating earnings per share of $6.43, up 9% from the previous year. Adjusted operating return on equity excluding accumulated other comprehensive income was a strong 47.9% in the quarter. We don’t anticipate making a material change to our $333 fair value estimate for narrow-moat Ameriprise. We assess the shares as being modestly undervalued.