Ares Management L.P. (ARES) vs. OM Asset Management PLC (OMAM) Financial Analysis
Ares Management L.P. (NYSE: ARES) and OM Asset Management PLC (NYSE:OMAM) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, profitabiliy, earnings, analyst recommendations, valuation, institutional ownership and risk.
Risk & Volatility
Ares Management L.P. has a beta of 1.24, meaning that its share price is 24% more volatile than the S&P 500. Comparatively, OM Asset Management PLC has a beta of 1.72, meaning that its share price is 72% more volatile than the S&P 500.
This table compares Ares Management L.P. and OM Asset Management PLC’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Ares Management L.P.||5.65%||35.09%||6.51%|
|OM Asset Management PLC||16.48%||81.34%||12.55%|
This is a breakdown of recent ratings and price targets for Ares Management L.P. and OM Asset Management PLC, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Ares Management L.P.||0||2||6||0||2.75|
|OM Asset Management PLC||0||1||6||0||2.86|
Ares Management L.P. presently has a consensus price target of $20.86, suggesting a potential upside of 11.24%. OM Asset Management PLC has a consensus price target of $17.30, suggesting a potential upside of 16.97%. Given OM Asset Management PLC’s stronger consensus rating and higher probable upside, analysts plainly believe OM Asset Management PLC is more favorable than Ares Management L.P..
Valuation and Earnings
This table compares Ares Management L.P. and OM Asset Management PLC’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Ares Management L.P.||$1.30 billion||3.09||$241.00 million||$0.66||28.41|
|OM Asset Management PLC||$710.10 million||2.39||$164.20 million||$0.98||15.09|
Ares Management L.P. has higher revenue and earnings than OM Asset Management PLC. OM Asset Management PLC is trading at a lower price-to-earnings ratio than Ares Management L.P., indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
14.6% of Ares Management L.P. shares are held by institutional investors. Comparatively, 46.2% of OM Asset Management PLC shares are held by institutional investors. 1.5% of OM Asset Management PLC shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Ares Management L.P. pays an annual dividend of $0.52 per share and has a dividend yield of 2.8%. OM Asset Management PLC pays an annual dividend of $0.36 per share and has a dividend yield of 2.4%. Ares Management L.P. pays out 78.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. OM Asset Management PLC pays out 36.7% of its earnings in the form of a dividend.
OM Asset Management PLC beats Ares Management L.P. on 10 of the 15 factors compared between the two stocks.
Ares Management L.P. Company Profile
Ares Management, L.P. is an alternative asset manager. The Company offers its investors a range of investment strategies. It operates through three segments: Credit Group, Private Equity Group and Real Estate Group. The Credit Group segment manages credit strategies across the non-investment grade credit universe in the United States and Europe. It offers a range of credit strategies across the liquid and illiquid spectrum, including syndicated loans, high yield bonds, credit opportunities, structured credit investments and the United States and European direct lending. The Credit Group provides solutions for traditional fixed income investors. The Private Equity Group segment categorizes its investment strategies as corporate private equity, the United States power and energy infrastructure and special situations. The Real Estate Group segment manages public and private equity and debt strategies. The Real Estate Group manages both a value-add strategy and an opportunistic strategy.
OM Asset Management PLC Company Profile
OM Asset Management plc is a global, diversified, multi-boutique asset management company. As of December 31, 2016, the Company operated its business through its eight Affiliates, each of which operated autonomously and employed its own investment processes. Its Affiliates include Acadian Asset Management LLC; Barrow, Hanley, Mewhinney & Strauss, LLC; Campbell Global, LLC; Copper Rock Capital Partners LLC; Heitman LLC; Investment Counselors of Maryland, LLC; Landmark Partners, LLC, and Thompson, Siegel & Walmsley LLC. It works with boutique asset managers, and the Company leverages the resources within its organization to engage with its Affiliates and provide them with capabilities unavailable to specialist asset management firms. The Company works with its Affiliates to identify and execute upon opportunities for their businesses in areas, such as business line expansion and product development, as well as activities required for the operation of investment boutiques.
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