Affiliated Managers Group (NYSE: AMG) and Eagle Point Credit (NYSE:ECC) are both finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their risk, analyst recommendations, dividends, profitability, valuation, institutional ownership and earnings.
Valuation and Earnings
This table compares Affiliated Managers Group and Eagle Point Credit’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Affiliated Managers Group||$2.31 billion||4.55||$689.50 million||$12.07||15.93|
|Eagle Point Credit||$65.29 million||5.16||$31.13 million||$1.73||10.36|
Affiliated Managers Group has higher revenue and earnings than Eagle Point Credit. Eagle Point Credit is trading at a lower price-to-earnings ratio than Affiliated Managers Group, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Affiliated Managers Group has a beta of 1.55, indicating that its stock price is 55% more volatile than the S&P 500. Comparatively, Eagle Point Credit has a beta of 0.21, indicating that its stock price is 79% less volatile than the S&P 500.
Institutional & Insider Ownership
96.6% of Affiliated Managers Group shares are held by institutional investors. Comparatively, 57.1% of Eagle Point Credit shares are held by institutional investors. 1.4% of Affiliated Managers Group shares are held by insiders. Comparatively, 0.6% of Eagle Point Credit shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
Affiliated Managers Group pays an annual dividend of $1.20 per share and has a dividend yield of 0.6%. Eagle Point Credit pays an annual dividend of $2.40 per share and has a dividend yield of 13.4%. Affiliated Managers Group pays out 9.9% of its earnings in the form of a dividend. Eagle Point Credit pays out 138.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
This table compares Affiliated Managers Group and Eagle Point Credit’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Affiliated Managers Group||29.92%||18.61%||9.52%|
|Eagle Point Credit||47.68%||10.46%||7.06%|
This is a summary of current ratings and target prices for Affiliated Managers Group and Eagle Point Credit, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Affiliated Managers Group||0||2||5||0||2.71|
|Eagle Point Credit||0||0||4||0||3.00|
Affiliated Managers Group currently has a consensus target price of $228.43, suggesting a potential upside of 18.81%. Eagle Point Credit has a consensus target price of $21.13, suggesting a potential upside of 17.89%. Given Affiliated Managers Group’s higher probable upside, analysts clearly believe Affiliated Managers Group is more favorable than Eagle Point Credit.
Affiliated Managers Group beats Eagle Point Credit on 12 of the 16 factors compared between the two stocks.
Affiliated Managers Group Company Profile
Affiliated Managers Group, Inc. is an asset management company with equity investments in boutique investment management firms. The Company operates in three segments, which represent its principal distribution channels: Institutional, Mutual Fund and High Net Worth. The equity method investments in the Institutional distribution channel are made in relationships with public and private client entities, including foundations, endowments, sovereign wealth funds and retirement plans for corporations and municipalities. The equity method investments in the Mutual Fund distribution channel are made in advisory or sub-advisory relationships with active return-oriented mutual funds, Undertakings for Collective Investment in Transferable Securities and other retail products. The equity method investments in the High Net Worth distribution channel are made in relationships with high net worth and ultra-high net worth individuals, families, trusts, foundations, endowments and retirement plans.
Eagle Point Credit Company Profile
Eagle Point Credit Company Inc. is a non-diversified, closed-end management investment company. The Company’s primary investment objective is to generate high current income, with a secondary objective to generate capital appreciation. The Company primarily invests in equity and junior debt tranches of collateralized loan obligations (CLOs) that are collateralized by a portfolio consisting primarily of the below investment grade United States senior secured loans. It may also invest in other securities and instruments related to these investments. The Company’s portfolio includes its investments in various industries, such as business equipment and services; healthcare; electronics/electrical; leisure goods/activities/movies; retailers (except food and drug); chemicals and plastics; telecommunications; financial intermediaries, and utilities. The Company’s advisor is Eagle Point Credit Management LLC.
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