AMERIPRISE FINANCIAL INC (AMP): what the price requires

At today's price, AMERIPRISE FINANCIAL INC (AMP) is priced for +2.4% earnings growth. boothcheck doesn't publish a fair value or a price target; it shows what the price assumes, so you can judge whether that bar is too high.

Generated: 2026-07-14 · Exported: 2026-07-16 · Source: https://boothcheck.com/report/AMP

Headline

FieldValue
TickerAMP
CompanyAMERIPRISE FINANCIAL INC
Current price$515.39/sh
CompositionAdvice & Wealth Management 61% / Asset Management 19% / Retirement & Protection Solutions 20%

What The Price Requires (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

FieldValue
Inversion basisfee-financial
Implied earnings growth2.4%
Price-to-earnings13.6x
Earnings yield7.3%

A hybrid: a fee franchise alongside a sizeable balance sheet, valued here on the fee annuity.

Solve inputs: computed at a 11.1% cost of equity with 4% terminal growth over a 5-year stage, on a 5-year median GAAP earnings base; each 1pp of cost of equity moves the implied earnings growth ~3.3pp.

Reconcile: at the x-ray's 9.3% required return this reads ~-4.3%/yr; the models below use their own rates.

How unusual the bet is: within-range (limited comparison data)

ReferenceValue
vs own history-0.24σ
cohort percentile (of 49 peers)14

Valuation X-Ray

The price is supported by asset-based and earnings-power and relative-multiple value. A value/asset-supported name, not a pure growth bet.

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

FamilyMedian price/FVModelsReads
Asset0.93x4justifies
Earnings0.79x2justifies
Relative0.60x4justifies
Growth1.28x1expensive

Families that justify the price: Asset, Earnings, Relative

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 5.6%); the inversion above states its own rate.

Per-Model Detail (n=11)

ModelFamilyFVPrice/FVApplicableMethodology
DCF Perpetual GrowthGrowth——no—
DCF Exit MultipleGrowth$0.00—noNegative/zero FCF or EBITDA — equity value floored at $0
Relative ValuationRelative$528.120.98xyesP/E 12x (static sector reference · 2026-04), scenarios: 10.0x / 12.0x / 14.0x (bear / base = reference held flat / bull), EV/EBITDA N/Ax
Simple DDMGrowth——no—
Two-Stage DDMGrowth——no—
Simple Excess ReturnAsset$445.591.16xyesBV/sh $65.74, ROE (TTM) 62.7%, ke 9.3%
Two-Stage Excess ReturnAsset$1613.850.32xyes5yr excess ROE then converge to ke=9.3%
Discounted Future Market CapGrowth$403.691.28xyesRev $19.3B, growth 7% (input: historical growth; tapered), Terminal P/S: 2.1x / 2.5x / 2.9x (bear / base = today's held flat / bull, cap 8x)
Peter Lynch Fair ValueRelative$1404.550.37xyesEPS $40.13, growth 35% (input: historical EPS growth), PEG=0.36 (Undervalued)
Margin TrajectoryGrowth——no—
Earnings Power ValueEarnings——no—
Residual IncomeAsset$733.810.70xyesBV $65.74 + 5yr PV of (ROE (TTM) 62.7% − Kₑ 9.3%) × BV; BV grows 8.8%/yr
Graham NumberAsset$243.632.12xyes√(22.5 × EPS $40.13 × BVPS $65.74) — Graham's conservative floor
EV/EBITDA RelativeRelative——no—
FCF YieldEarnings$0.0151539.00xyesFCF $6941.0M / Kₑ 9.3% — zero-growth perpetuity (excluded from median)
SBC-Adj FCF YieldEarnings$0.0151539.00xyesSBC-adj FCF $6.71B (FCF $6.94B − SBC $0.23B) capitalized at Kₑ (excluded from median)
Ben Graham FormulaEarnings$1294.860.40xyesEPS $40.13 × (8.5 + 2×15.0%) × (4.4 / 5.3%)
ROIC-Justified P/BAsset——no—
P/Sales SectorRelative$613.210.84xyesRevenue $19.32B × sector P/S 3.0x
PEG Fair ValueRelative$1504.870.34xyesEPS $40.13 × (PEG 1.5 × growth 25.0% (input: historical EPS growth)) → PE 37.5x
Earnings YieldEarnings$433.841.19xyesEPS $40.13 / required return 9.3% (Rf 4.3% + ERP 5.0%)
Funds From Operations MultipleRelative——no—
Clinical Phase NPVGrowth——no—
MertonAsset——no—
V5 Mechanical———no—

Solvency

FieldValue
Share count CAGR (buyback)-5.0%

Custody and consolidated-fund balance sheet: deposits, client cash, and fund-level debt are not corporate leverage, and operating cash flow follows client flows. Net-debt, coverage, and cash-burn lenses are suppressed as misleading; share-count CAGR is kept. The fee-earnings read above is the valuation basis.

Bullet Takeaways

Bull Case

Read Ameriprise as a mature fee compounder and the numbers read differently than the diversified-financial label suggests. The business is built on assets that bill predictably: financial planning fees that are "either a fixed fee (received monthly, quarterly or annually) or a varia"ble fee, and advisory fees "billed on a monthly basis on the prior month end assets." That is recurring, asset-linked revenue, the kind that grows quietly as the advisor base gathers more client money and compounds with the market over time. The recent results show the engine working: assets under management, administration and advisement reached $1.7 trillion, up 12%, with the wealth management division driving a 14% revenue increase at a 28% operating margin.

The return profile is the standout, and it is what a capital-light fee franchise is supposed to look like. Return on equity reached 54.1% in the most recent quarter, up 140 basis points year over year. A firm earning that kind of return on its equity base, while distributing capital rather than hoarding it, is converting client assets into shareholder value efficiently. The share count has been falling about 5% a year, which is buyback deployment showing up where it cannot be faked, and it means each remaining share owns a growing slice of that high-return franchise.

Growth comes from adding distribution, not from taking more market risk. The multiyear agreement with Huntington Bank adds roughly 260 advisors and about $28 billion in assets, a channel expansion that feeds directly into the fee base, and the firm is investing in AI within advisor workflows to make each advisor more productive. The bull case does not need an aggressive assumption: the price asks for only modest fee-earnings growth, and a high-return franchise that keeps adding advisors and buying back stock clears that bar without heroics.

Bear Case

The variable with the most leverage on Ameriprise is the equity market, and the firm has no control over it. Because revenue is billed on prior-month-end asset levels, a market decline mechanically lowers the fee base, and the company's own filing is blunt about the breadth of the exposure, listing "capital market and credit crises, the repricing of credit risk, equity market volatility and decline, and stress or recession in the U.S. and global economies generally" as conditions that hit every segment at once. The cruelty of the model is the correlation: the same drawdown that shrinks asset-based fees also chills client engagement and new flows, so a bad market compresses both the price and the volume of the fee stream in the same quarter.

The retirement and protection segment carries a different, slower-burn risk that the fee-franchise framing can obscure. That fifth of the business writes insurance and annuity products whose economics depend on the company's financial strength ratings, and the filing warns that "any future downgrade in our financial strength ratings, or the announced or perceived potential for a downgrade, could potentially have a significant advers"e effect on the ability to market those products. A protection franchise lives on the perception that it will be there to pay claims decades out, which means a ratings action does not just raise funding cost, it can impair the segment's ability to sell at all. It is a tail risk, but it is the kind that arrives suddenly.

The valuation does not give the bear much of an overvaluation argument, which forces the bear onto these structural risks rather than the multiple. At about 12 times earnings, the price embeds only roughly 0.4% annual fee-earnings growth, a bar so low it sits in the lower half of the fee-financial peer group. So the bear here is not that the price is stretched; the asset, earnings, and peer-multiple lenses all support it. It is that the durable-looking fee annuity is more market-sensitive than its steady margins suggest, and that a serious equity drawdown or a ratings event would expose how much of the franchise's value depends on conditions outside management's hands.

Valuation

A capital-light fee business is worth the fee earnings it throws off, not its book value, so the right lens is price-to-earnings. At about 12 times earnings, an 8.1% earnings yield, the price implies Ameriprise grows its fee earnings only around 0.4% a year. That is close to flat, a bar the firm has comfortably cleared against its own record, and against its fee-financial peers it lands in the lower half on price-to-earnings. The market is not asking this business to grow so much as it is asking it not to shrink.

The methods we use to triangulate agree, which is the signal worth naming. The asset-value lens, the earnings-power lens, and the peer-multiple lens all support the price or read it as cheap; only the forward-growth method, which credits future compounding, sits above the current level. When three of four families say the price is supported and none says it is expensive, this is a value-and-asset-supported name, not a growth bet riding on a single optimistic method. One coherence note for a reader looking at the sell side: the street has nudged its mean target to roughly $541, which sits above today's price but credits a touch more forward growth and margin than this framework's near-flat read does, the gap being what the analysts assume about asset growth that the inversion does not.

The balance-sheet read for Ameriprise is different from a typical operating company, and it belongs in the close. Much of what looks like leverage on the balance sheet is client cash, deposits, and fund-level positions rather than corporate debt, and operating cash flow follows client flows, so the standard net-debt and coverage math is misleading here. What governs instead is the financial-strength rating that supports the protection segment and the capital-return capacity behind the buyback. The share count falling about 5% a year is the cleanest evidence that the high-return franchise is generating more capital than it needs, returning the surplus rather than reinvesting it into risk. The decisive fact is not the modest growth the price requires; it is that the fee base sits on $1.7 trillion of client assets whose level moves with markets the firm cannot steer.

Catalysts

The first-quarter 2026 print was a clean beat that reinforced the fee-compounder story. Revenue came in at $4.77 billion and reported EPS at $11.26, above Wall Street estimates, with assets under management, administration and advisement reaching $1.7 trillion, up 12%, and the wealth management division posting a 14% revenue increase at a 28% operating margin. Return on equity of 54.1%, up 140 basis points year over year, was the headline efficiency number, and it underpins the firm's continued capital return through dividends and buybacks.

The strategic catalyst to watch is distribution growth. Ameriprise signed a multiyear agreement with Huntington Bank that adds roughly 260 advisors and about $28 billion in assets, a direct expansion of the fee base, and is investing in AI within advisor workflows to lift advisor productivity. On the sell side, analysts nudged the mean price target higher to about $541, tied to a higher profit-margin outlook against slightly softer revenue-growth assumptions. The forward watch list is straightforward: whether the Huntington advisors and assets convert as expected, whether asset levels hold through any market volatility, and whether the buyback keeps shrinking the share count against that high return on equity.

Peer Cohorts (Per Segment, With Filing Citations)

Advice & Wealth Management (reported)

Asset Management (reported)

Retirement & Protection Solutions (reported)

Methodology Note

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.

Sources

Ameriprise Q1 2026 results, April 2026 · Ameriprise Q1 2026 results and earnings call, April 2026 · analyst consensus, 2026

View the full interactive AMP report on boothcheck