Nasdaq:SEIC
SEI INVESTMENTS CO
A premier middle-market investment manager and insurance provider delivering scalable wealth and risk solutions with robust cash flow generation.
Key Metrics
Investment Thesis
Bull Case
SEIC offers an attractive risk-adjusted return profile backed by a strong track record of revenue expansion and profitability improvement over the last three years. The investment case is strengthened by its ability to generate substantial operating cash flow ($607.7M) which supports consistent shareholder returns without heavy capex burdens. Favorable secular trends in wealth management and the persistent need for specialized middle-market insurance solutions provide a stable long-term growth runway.
Bear Case
Valuation may be stretched given the recent acceleration in net income, leaving limited margin of safety for investors seeking value entry points. The aggressive share repurchase program of $628.1M could become unsustainable if market conditions deteriorate or if acquisition costs rise beyond current levels. Dependence on a specific client demographic exposes the firm to potential secular shifts in investment preferences or insurance demand patterns that could disrupt its core revenue streams.
About SEI INVESTMENTS CO
SEIC (Nasdaq: SEIC) is a leading provider of investment management and insurance services primarily serving the U.S. middle-market business community. The company operates through its core investment platform and subsidiary entities offering tailored risk management solutions. With revenue growing to $2.30B in 2025, SEIC demonstrates strong operational leverage in a specialized financial services niche.
Analysis
Management Discussion
Management successfully navigated a challenging macro environment to drive revenue growth from $1.92B in 2023 to $2.30B in 2025, while net income surged to $717.5M. The company maintained financial discipline by returning significant capital to shareholders through $628.1M in share repurchases and $124.2M in dividends, despite heavy investing cash outflows of $399.1M likely driven by strategic M&A activity.
Industry Overview
The financial services industry for middle-market companies is highly competitive but fragmented, creating opportunities for specialized players with niche expertise. Regulatory oversight remains stringent, requiring firms like SEIC to maintain high capital reserves and compliance standards which can increase operating costs. Technology adoption is accelerating across the sector, pushing firms to invest in digital platforms while retaining personal advisory relationships.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue | $1.99B | $1.92B | $2.13B | $2.30B |
| Cost of Revenue | $1.35B | $1.36B | $1.43B | $1.49B |
| Gross Profit | $643.9M | $556.8M | $699.4M | $808.1M |
| Operating Expenses | $168.2M | $132.2M | $147.6M | $180.8M |
| Operating Income | $475.8M | $424.5M | $551.7M | $627.3M |
| G&A | $168.2M | $132.2M | $147.6M | $180.9M |
| Marketing | — | — | $174.5M | $174.3M |
| Stock-Based Comp | $39.4M | $31.3M | $58.6M | $53.6M |
| Amortization | $12.6M | $12.2M | $13.4M | $14.8M |
| Other OpEx | $0 | $0 | $-174.5M | $-174.3M |
| Non-Operating Income | $133.5M | $170.1M | $195.0M | $289.0M |
| Interest Expense | $749.0K | $583.0K | — | — |
| Pre-Tax Income | $609.3M | $594.7M | $746.8M | $916.3M |
| Income Tax | $133.8M | $132.4M | $165.6M | $198.8M |
| Continuing Ops | $475.5M | $462.3M | $581.2M | $717.5M |
| Discontinued Ops | $0 | $0 | $0 | $0 |
| Net Income | $475.5M | $462.3M | $581.2M | $717.5M |
| Minority Interest | $0 | $0 | $0 | $2.2M |
| Net to Common | $475.5M | $462.3M | $581.2M | $715.3M |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Current Assets | $1.45B | $1.48B | $1.55B | $1.27B |
| Cash & Equivalents | $853.0M | $834.7M | $839.9M | $399.8M |
| Accounts Receivable | $457.1M | $501.4M | $567.6M | $709.7M |
| Other Current Assets | $143.2M | $142.0M | $144.3M | $163.8M |
| Long-Term Assets | $930.2M | $1.04B | $1.13B | $1.99B |
| PP&E (Net) | $181.0M | $171.4M | $159.6M | $150.4M |
| Intangibles | $55.5M | $82.4M | $77.4M | $368.3M |
| Goodwill | $115.6M | $137.3M | $170.3M | $355.0M |
| Operating Leases | $25.0M | $22.5M | $28.9M | $26.4M |
| Other LT Assets | $553.1M | $628.3M | $572.8M | $897.2M |
| Total Assets | $2.38B | $2.52B | $2.68B | $3.26B |
| Current Liabilities | $397.9M | $353.0M | $380.5M | $387.2M |
| Accounts Payable | $13.3M | $10.6M | $13.1M | $5.4M |
| Current Leases | $10.3M | $8.1M | $7.9M | $8.7M |
| Deferred Revenue | $14.9M | $15.4M | $12.0M | $13.3M |
| Other Current Liab | $-58.1M | $-61.1M | $-63.9M | $-65.2M |
| Long-Term Liabilities | $31.8M | $35.1M | $52.0M | $412.8M |
| LT Operating Leases | $18.8M | $17.2M | $24.2M | $19.9M |
| Other LT Liab | $12.3M | $17.1M | $26.9M | $392.9M |
| Total Liabilities | $429.7M | $388.2M | $432.5M | $800.0M |
| Shareholders' Equity | $1.95B | $2.13B | $2.25B | $2.46B |
| Retained Earnings | $694.3M | $762.6M | $758.0M | $792.3M |
| AOCI | $-49.0M | $-37.0M | $-47.0M | $-24.5M |
| Total L&E | $2.38B | $2.52B | $2.68B | $3.26B |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Net Income (CFO) | $475.5M | $462.3M | $581.2M | $717.5M |
| Non-Cash Adjustments | $-17.0M | $-54.2M | $-52.8M | $-211.0M |
| Working Capital Changes | $107.6M | $39.0M | $94.0M | $101.1M |
| Cash from Operations | $566.1M | $447.0M | $622.3M | $607.7M |
| Capital Expenditures | $39.2M | $24.8M | $32.2M | $22.6M |
| Cash from Investing | $-89.8M | $-141.5M | $-117.3M | $-399.1M |
| Share Buybacks | $344.7M | $308.9M | $500.1M | $628.1M |
| Dividends Paid | $109.8M | $114.8M | $120.3M | $124.2M |
| Cash from Financing | $-437.2M | $-331.3M | $-494.4M | $-589.5M |
| FX Effect | $-17.5M | $7.5M | $-5.4M | $11.3M |
| Net Change in Cash | $21.6M | $-18.4M | $5.2M | $-369.6M |
| Beginning Cash | $831.8M | $853.4M | $835.0M | $840.2M |
| Ending Cash | $853.4M | $835.0M | $840.2M | $399.8M |
Frequently Asked Questions
How does SEI INVESTMENTS CO make money?
The company derives revenue from its primary investment management platform serving individual investors and institutions, alongside specialized insurance brokerage and reinsurance operations. Significant acquisitions totaling $302M in the latest year suggest active growth via organic M&A within the middle-market space. High accounts receivable of $709.7M relative to payables indicates a strong fee-based business model with extended collection cycles typical of institutional asset management.
What are the main risks for SEIC?
Concentration risk exists as the business heavily relies on the performance of middle-market assets and specific insurance underwriting cycles which can be volatile. Regulatory changes in the financial services and insurance sectors could impact fee structures or licensing requirements, affecting margins. The company's reliance on acquired entities for growth introduces integration risks and potential dilution if deal synergies are not realized as planned.
What is SEIC's competitive advantage?
SEIC possesses deep domain expertise in the U.S. middle-market sector, allowing it to tailor complex investment and insurance strategies for mid-cap clients often underserved by large banks. The company's disciplined capital allocation is evidenced by a healthy operating cash flow of $607.7M and minimal capital expenditures of $22.6M relative to revenue. A resilient balance sheet with $399.8M in ending cash provides flexibility for strategic acquisitions while maintaining low leverage.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.