Contrasting Brightsphere Investment Group (BSIG) & Invesco (IVZ)

Brightsphere Investment Group (NYSE: IVZ) and Invesco (NYSE:IVZ) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, earnings, valuation, institutional ownership, risk and dividends.

Dividends

Brightsphere Investment Group pays an annual dividend of $0.27 per share and has a dividend yield of 2.2%. Invesco pays an annual dividend of $1.20 per share and has a dividend yield of 5.0%. Brightsphere Investment Group pays out 16.7% of its earnings in the form of a dividend. Invesco pays out 44.4% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Invesco has increased its dividend for 9 consecutive years. Invesco is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Brightsphere Investment Group and Invesco’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Brightsphere Investment Group 3.06% 138.53% 13.71%
Invesco 21.64% 12.70% 3.61%

Valuation and Earnings

This table compares Brightsphere Investment Group and Invesco’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Brightsphere Investment Group $887.40 million 1.55 $4.20 million $1.62 7.72
Invesco $5.16 billion 1.91 $1.13 billion $2.70 8.91

Invesco has higher revenue and earnings than Brightsphere Investment Group. Brightsphere Investment Group is trading at a lower price-to-earnings ratio than Invesco, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

1.3% of Brightsphere Investment Group shares are held by institutional investors. Comparatively, 78.8% of Invesco shares are held by institutional investors. 0.6% of Brightsphere Investment Group shares are held by insiders. Comparatively, 1.8% of Invesco shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of current recommendations and price targets for Brightsphere Investment Group and Invesco, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Brightsphere Investment Group 0 1 5 0 2.83
Invesco 0 6 7 0 2.54

Brightsphere Investment Group presently has a consensus target price of $19.67, suggesting a potential upside of 57.21%. Invesco has a consensus target price of $35.69, suggesting a potential upside of 48.41%. Given Brightsphere Investment Group’s stronger consensus rating and higher probable upside, analysts clearly believe Brightsphere Investment Group is more favorable than Invesco.

Summary

Invesco beats Brightsphere Investment Group on 11 of the 16 factors compared between the two stocks.

Brightsphere Investment Group Company Profile

BrightSphere Investment Group plc is a publically owned asset management holding company. The firm provides its services to individuals and institutions. It manages separate client focused portfolios through its subsidiaries. The firm also launches equity mutual funds for its clients. It invests in public equity, fixed income, and alternative investment markets through its subsidiaries. The firm was founded in 1980 is based Boston, Massachusetts. It was formally known as OM Asset Management plc. BrightSphere Investment Group plc operates as a former subsidiary of Old Mutual Global Investors.

Invesco Company Profile

Invesco Ltd. is a publicly owned investment manager. The firm provides its services to retail clients, institutional clients, high-net worth clients, public entities, corporations, unions, non-profit organizations, endowments, foundations, pension funds, financial institutions, and sovereign wealth funds. It manages separate client-focused equity and fixed income portfolios. The firm also launches equity, fixed income, commodity, multi-asset, and balanced mutual funds for its clients. It launches equity, fixed income, multi-asset, and balanced exchange-traded funds. The firm also launches and manages private funds. It invests in the public equity and fixed income markets across the globe. The firm also invests in alternative markets, such as commodities and currencies. For the equity portion of its portfolio, it invests in growth and value stocks of large-cap, mid-cap, and small-cap companies. For the fixed income portion of its portfolio, the firm invests in convertibles, government bonds, municipal bonds, treasury securities, and cash. It also invests in short term and intermediate term bonds, investment grade and high yield bonds, taxable and tax-free bonds, senior secured loans, and structured securities such as asset-backed securities, mortgage-backed securities, and commercial mortgage-backed securities. The firm employs absolute return, global macro, and long/short strategies. It employs quantitative analysis to make its investments. The firm was formerly known as Invesco Plc, AMVESCAP plc, Amvesco plc, Invesco PLC, Invesco MIM, and H. Lotery & Co. Ltd. Invesco Ltd. was founded in December 1935 and is based in Atlanta, Georgia with an additional office in Hamilton, Bermuda.

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