T. Rowe Price Group, Inc. (TROW) — Fundamental Analysis & Key Financial Ratios

Kaplio's reading: T. Rowe Price Group, Inc.

Updated on October 31, 2026 · accounts published on October 29, 2026

A highly profitable, barely leveraged business whose margins have slipped

T. Rowe Price trades at a P/E of 10.5, 28 % below its ten-year median, with a 5 % dividend yield and almost no debt.

• Is T. Rowe Price expensive or cheap? T. Rowe Price has traded at a lower P/E only 15 % of the time in the last decade; today it is 28 % below its ten-year median.
• How is the business doing? Operating margin fell to 29.9 % in fiscal 2025, the lowest in 12 years and well below the 40.5 % average since 2014.
• How strong is the balance sheet? Debt is only 0.04 times equity, and the dividend yields 5 % over the last 12 months with a 55 % payout in fiscal 2025.
• What to expect from the next earnings? Analysts expect EPS of $2.41 for the quarter reported on February 3, 2027; only 8 of 38 rate the stock a buy.
• Is it a scalable business with little leverage? Leverage passes easily, but revenue per share grew 3.8 % a year in fiscal 2020-2025, short of the sector's 6 % healthy mark.

Is T. Rowe Price expensive or cheap?

Over the last 12 months T. Rowe Price trades at a P/E of 10.5. Its ten-year median is 14.7, and over the decade the P/E has ranged from 7.2 to 24.2. It also sits 19 % below the 13.0 median of 324 financial-services companies. It is under 90 % of its own five-year average of 13.7, the line this sector uses to call a multiple cheap. A free cash flow yield of 13 % over the last 12 months points the same way. The market is pricing in slow growth: the shares are 15 % below their 52-week high of $121.68, yet up 6 % over the last 12 months.

How is the business doing?

Revenue grew 3 % and EPS just 1 % over the last 12 months. The bigger shift is in profitability. The operating margin averaged 40.5 % across fiscal 2014-2025 and dropped to 29.9 % in fiscal 2025, the weakest of those 12 years. The figure for the last 12 months, 31.5 %, shows a slight recovery. A net margin of 28 % and a 20 % ROE still describe a very profitable business. What has changed is the ceiling: each dollar of revenue now leaves roughly ten cents less operating profit than the norm since 2014.

How strong is the balance sheet?

Over the last 12 months debt equals just 0.04 times equity. That is far below the 0.5 level considered prudent for financial-services firms, so the balance sheet carries almost no financial risk. Shareholders collect a 5 % dividend yield, and the dividend per share has risen for three consecutive fiscal years through 2025. Paying out 55 % of fiscal 2025 earnings leaves a cushion if profits soften. The weaker link is cash: free cash flow covered 71 % of net income in fiscal 2025, so reported profit overstates the cash actually available for dividends.

What to expect from the next earnings?

T. Rowe Price reported its latest quarter on October 29, 2026. EPS came in at $2.86 against $2.63 expected, an 8.7 % beat, and the company has topped estimates in 6 of the last 8 quarters. Analysts remain cautious: 24 of 38 rate the stock a hold and 6 a sell. The 2026 EPS consensus slipped 0.5 % in 30 days, from $10.20 to $10.14 across 8 analysts, while revenue forecasts barely moved. The bar for February 3, 2027 is $2.41 per share, below the last quarter's result, so another beat looks within reach if margins hold.

Is it a scalable business with little leverage?

Asset managers, brokers and exchanges do not lend against their balance sheets the way banks do, so book value says little about them. What matters is whether fee revenue grows and whether profit turns into cash. On those tests T. Rowe Price gets a mixed report. Its ROE of 19.9 % over the last 12 months clears the 15 % healthy mark, and debt passes easily. Revenue per share grew 3.8 % a year over fiscal 2020-2025, short of the 6 % threshold. The fiscal 2025 operating margin of 29.9 % sits right at the 30 % line, and cash conversion of 71 % falls below the 90 % bar.

How this was prepared: the data comes from companies' official filings, collected by a professional provider, and from Kaplio's analysis engine (trailing-12-month ratios, 10 years of history and sector medians computed across US-listed companies). The text is written from that data alone, every figure is checked against it before publication, and it is reviewed when the company reports results. This is not investment advice.