Equitable Holdings Acquires $17 Million in AllianceBernstein Units

Equitable Holdings, Inc. has made a notable investment in AllianceBernstein Holding L.P., purchasing approximately $17 million worth of units in the investment management firm. On September 20, 2024, Equitable Holdings acquired 500,000 units at a price of $34.1834 each.

This acquisition increases Equitable Holdings’ direct beneficial ownership to 3,066,838 units. Additionally, through its wholly-owned subsidiary Alpha Units Holding, LLC, the company indirectly owns 1,444,356 units. This recent purchase demonstrates Equitable Holdings’ ongoing commitment to investing in AllianceBernstein, reflecting their confidence in the firm’s value and future potential.

It’s important to note that Equitable Holdings and its affiliates also hold a significant number of AB Capital Units in AllianceBernstein L.P., with details available in separate filings. The transaction involving the Holding Units was executed in a privately negotiated deal, as indicated in the SEC filing.

Equitable Holdings has a rich history, having undergone several name changes, and it maintains a strong presence in the insurance and financial services sector. The acquisition of AllianceBernstein units represents a strategic move toward aligning with the investment advisory domain, likely enhancing Equitable Holdings’ portfolio diversification and revenue pathways.

The units, termed as “Units representing Assignments of Beneficial Ownership of Limited Partnership Interests,” illustrate Equitable Holdings’ stake in AllianceBernstein, further solidifying its role as a significant investor.

In other news, AllianceBernstein recently reported an 11% increase year-over-year in assets under management (AUM), totaling $770 billion. They also experienced a remarkable 42% rise in gross sales, amounting to $31.9 billion. Despite a $28 million investment loss from a joint venture, the firm reported growth in GAAP operating income and earnings per share, which increased by 6% and 87% respectively. Financial analysts have responded positively, with one firm raising AllianceBernstein’s price target and others maintaining favorable ratings as the company plans to enhance its U.S. retail market capabilities, boost growth in separately managed accounts, and introduce tax-efficient products. These developments emphasize the firm’s dedication to growth and returns for investors.

As Equitable Holdings bolsters its investment in AllianceBernstein, it is vital to assess the current financial standing of AllianceBernstein. With a market capitalization of about $3.99 billion, the valuation metrics present a mixed outlook for potential investors. AllianceBernstein’s P/E ratio of 12.12 indicates it might be trading at a relatively low price in relation to anticipated earnings growth, which could appeal to value investors.

Furthermore, AllianceBernstein’s focus on shareholder returns is highlighted by an impressive dividend yield of 8.17% and a consistent history of dividend payments for 37 consecutive years. These dividends have notably increased by 7.58% over the last twelve months, as of the second quarter of 2024. The firm also showcases profitability through a strong return on assets of 15.83% for the same period, which is a positive sign for prospective investors.

For those contemplating adding AllianceBernstein to their portfolios, it’s noteworthy that the company is currently trading close to its 52-week high, at approximately 97.84% of this peak. This trend could suggest that the market is acknowledging the firm’s value and future prospects, as reflected in Equitable Holdings’ recent investment. Those seeking further insights into AllianceBernstein’s performance and future outlook can explore additional resources and analyses to guide their investment choices.

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