Artisan Partners Asset Management (NYSE:APAM) and Ares Management (NYSE:ARES) are both finance companies, but which is the better stock? We will compare the two companies based on the strength of their analyst recommendations, dividends, earnings, valuation, profitability, risk and institutional ownership.
Volatility & Risk
Artisan Partners Asset Management has a beta of 1.91, meaning that its share price is 91% more volatile than the S&P 500. Comparatively, Ares Management has a beta of 1.18, meaning that its share price is 18% more volatile than the S&P 500.
Analyst Ratings
This is a breakdown of current ratings for Artisan Partners Asset Management and Ares Management, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
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Artisan Partners Asset Management | 0 | 0 | 4 | 0 | 3.00 |
Ares Management | 0 | 3 | 6 | 0 | 2.67 |
Artisan Partners Asset Management presently has a consensus target price of $52.50, indicating a potential upside of 9.58%. Ares Management has a consensus target price of $48.8571, indicating a potential downside of 4.50%. Given Artisan Partners Asset Management's stronger consensus rating and higher probable upside, equities research analysts clearly believe Artisan Partners Asset Management is more favorable than Ares Management.
Earnings & Valuation
This table compares Artisan Partners Asset Management and Ares Management's gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
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Artisan Partners Asset Management | $799 million | 4.71 | $156.54 million | $2.67 | 17.94 |
Ares Management | $1.77 billion | 7.49 | $148.88 million | $1.67 | 30.63 |
Artisan Partners Asset Management has higher earnings, but lower revenue than Ares Management. Artisan Partners Asset Management is trading at a lower price-to-earnings ratio than Ares Management, indicating that it is currently the more affordable of the two stocks.
Dividends
Artisan Partners Asset Management pays an annual dividend of $3.88 per share and has a dividend yield of 8.1%. Ares Management pays an annual dividend of $1.60 per share and has a dividend yield of 3.1%. Artisan Partners Asset Management pays out 145.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ares Management pays out 95.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Artisan Partners Asset Management has raised its dividend for 1 consecutive years and Ares Management has raised its dividend for 1 consecutive years.
Profitability
This table compares Artisan Partners Asset Management and Ares Management's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
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Artisan Partners Asset Management | 21.73% | 179.65% | 23.80% |
Ares Management | 7.22% | 16.07% | 2.09% |
Insider & Institutional Ownership
66.4% of Artisan Partners Asset Management shares are owned by institutional investors. Comparatively, 42.4% of Ares Management shares are owned by institutional investors. 24.4% of Artisan Partners Asset Management shares are owned by company insiders. Comparatively, 59.7% of Ares Management shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Summary
Artisan Partners Asset Management beats Ares Management on 10 of the 16 factors compared between the two stocks.