Conestoga Capital Advisors, LLC on SEI Investments Company
Thesis
SEI provides investment processing, asset administration and technology services. Conestoga expects rising complexity in investment operations, including the move of alternative assets into wealth and retirement channels, to support customer demand. Long contracts and established client relationships make the revenue foundation durable. Operating changes and disciplined capital allocation are expected to strengthen margins and growth.
“Multi-year contracts and longstanding client relationships provide a durable foundation”
Key risks
- Changes in the distribution of alternative investments could develop more slowly than expected.
- Operational changes require effective execution to improve margins.
- The higher-cost operating environment may limit clients investment and growth spending.