IVZ: Thoughts about IVZ share weakness

Research evidence excerpt

IVZ: Thoughts about IVZ share weakness

EQUITY RESEARCH QUICK TAKE

RBC Capital Markets, LLC

Kenneth S. Lee (Analyst)

Adam Fallis (Associate)

June 24, 2026

Invesco Ltd.

Thoughts about IVZ share weakness

NYSE: IVZ | USD 27.02 | Outperform | Price Target USD 31.00

Sentiment: Neutral

Net/net: We attribute weakness in IVZ shares on Tuesday (6.1% decline vs 1.4% decline in the S&P 500 index) partly to State Street

(STT, covered by RBC analyst Gerard Cassidy) filing a prospectus for its new Nasdaq-100 index ETF; interestingly, filings indicate the

management fee rate on the product would be 10bps, which would be materially lower than the roughly 18bps fee rate for IVZ's

QQQ product. As a reminder, the Nasdaq licensing fee alone would likely be 8bps for all providers. Recall, in early April, BlackRock

(BLK, not covered) and State Street separately filed to launch index ETFs based on the Nasdaq-100 index as Nasdaq expanded the

licensing of the index; IVZ's QQQ previously had the exclusive license.

While a lower-fee Nasdaq-100 index ETF product could alter competitive dynamics for money in motion for IVZ's QQQ product,

which had nearly $500bn AUM as of May 31, we still believe the QQQ's installed base would be tough to erode given potential

taxes on unrealized gains that could make switching costs high. Further, the QQQ's advantages include liquidity, tight spreads/

low tracking error, deep options markets, broad retail/institutional investor base, and brand recognition. We would also point out

that IVZ itself had introduced a lower-fee QQQM product in the past that did not cannibalize QQQ product growth. Our recent

monthly analysis of net flows using Simfund data had indicated that IVZ's QQQ product likely had positive net flows for the months

of April and May.