Insights 
VT 
Quarterly Revenue Performance
T. Rowe Price reported quarterly earnings of $2.81 per share, exceeding the Zacks Consensus Estimate of $2.55. This marks an improvement from last year’s $2.57 per share, after adjustments for non-recurring items.
The earnings surprise was +10.20%, while the previous quarter saw a smaller surprise of +4.19%. T. Rowe has surpassed consensus EPS estimates in three of the last four quarters.
Quarterly revenues were $1.89 billion, a 2.34% rise above estimates, compared to $1.79 billion from the previous year. Over the past four quarters, the company has exceeded revenue estimates once.
Shares have declined by 9.7% since the year’s start, compared to the S&P 500’s 16% gain. The outlook for T. Rowe depends on upcoming earnings expectations and management commentary.
The company currently holds a Zacks Rank #1 (Strong Buy), indicating anticipated market outperformance. The consensus EPS estimate for the next quarter is $2.39, with revenues of $1.91 billion.
Industry Comparisons
Within the same industry, TPG Inc. is set to release quarterly earnings, expected at $0.55 per share, reflecting a 22.2% year-over-year increase. TPG’s revenues are anticipated to be $503.85 million, a 9.6% increase from the previous year.
With T. Rowe Price beating earnings expectations today, we have already seen the predictable drop in the stock’s implied volatility. Any strategies that involved selling premium, like short strangles, ahead of this scheduled news event would have profited from this volatility crush. The immediate focus now shifts to whether the positive surprise can generate genuine upward momentum in the stock price itself.
We see the strong earnings and revenue beat as a potential catalyst for a reversal in the stock’s year-to-date underperformance. With the Federal Reserve signaling a pause in rate hikes through the latter half of 2025, market conditions are favorable for asset managers. Recent industry data from September 2025 also showed that outflows from active equity funds have finally begun to stabilize, removing a significant headwind for the sector and supporting a more bullish outlook.
However, we must temper this optimism with the stock’s recent history. Despite a similar, albeit smaller, earnings beat back in July 2025, the subsequent rally in TROW shares quickly faded. Given that the stock is still down nearly 10% this year while the S&P 500 has climbed 16%, we should be cautious that this report may not be enough to change the broader negative sentiment.
For the coming weeks, we believe selling out-of-the-money put spreads with November or December 2025 expirations is a prudent strategy. This approach allows us to collect premium while defining our risk, betting that today’s strong results will at least provide a floor for the stock price. We would be hesitant to buy expensive call options until management provides confident forward-looking guidance on their earnings call.
TROW’s positive results also shine a light on its competitor, TPG, which reports on November 4th. Given that both firms operate in a highly-ranked industry experiencing more favorable conditions, we see an opportunity here. TPG’s options are currently pricing in a significant move, and its own earnings estimates have been revised higher, suggesting we could use TROW’s strength as a basis for a bullish play on TPG ahead of its announcement.
