Ahead of the Bell: Asset manager estimates cut

"In light of unprecedented volatility and global market deterioration, the group is expected to start 2009 with assets under management down 15 percent year over year, which will clearly weigh on earnings," Irizarry wrote in a note to clients.

Irizarry reduced 2009 earnings-per-share estimates on the group by an average of 26 percent and the price targets by an average of 25 percent.

Additionally, Irizarry downgraded Affiliated Managers Group Inc. to "Neutral" from "Buy."

"Although we continue to think Affiliated Managers is uniquely positioned to capture share via acquisitions, market volatility poses challenges to pursue deals, while many of the firm's existing affiliates are facing headwinds," Irizarry wrote.

Meanwhile, Irizarry upgraded Invesco Ltd. to "Buy" from "Neutral," noting the firm's diversified base of assets under management. A recent sell-off in Invesco shares has also created an attractive entry point, Irizarry said. Invesco shares have fallen nearly 39 percent in the past three weeks.

Among the firms that Irizarry rates at "Buy" are Eaton Vance Corp., BlackRock Inc. and Janus Capital Group Inc. Irizarry rates Cohen and Steers Inc., Calamos Asset Management Inc. and Gamco Investors Inc. at "Sell."

Keefe, Bruyette & Woods analyst Robert Lee also lowered his estimates and price targets on asset managers, due to expectations for lower assets under management. However, the analyst upgraded T. Rowe Price to "Market Perform" from "Underperform" as the shares are now trading in line with his $45 target price.