Royalty Management (NASDAQ:RMCO – Get Free Report) and Ares Management (NYSE:ARES – Get Free Report) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their dividends, valuation, analyst recommendations, institutional ownership, profitability, risk and earnings.
Insider & Institutional Ownership
67.2% of Royalty Management shares are owned by institutional investors. Comparatively, 50.0% of Ares Management shares are owned by institutional investors. 57.1% of Royalty Management shares are owned by company insiders. Comparatively, 36.9% of Ares Management shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Analyst Ratings
This is a summary of recent ratings and target prices for Royalty Management and Ares Management, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Royalty Management | 0 | 0 | 0 | 0 | 0.00 |
| Ares Management | 0 | 4 | 12 | 0 | 2.75 |
Valuation and Earnings
This table compares Royalty Management and Ares Management”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Royalty Management | $810,000.00 | 23.42 | -$110,000.00 | ($0.02) | -63.50 |
| Ares Management | $3.88 billion | 13.95 | $463.74 million | $1.70 | 97.60 |
Ares Management has higher revenue and earnings than Royalty Management. Royalty 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.
Volatility and Risk
Royalty Management has a beta of -0.26, suggesting that its share price is 126% less volatile than the S&P 500. Comparatively, Ares Management has a beta of 1.38, suggesting that its share price is 38% more volatile than the S&P 500.
Profitability
This table compares Royalty Management and Ares Management’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Royalty Management | -22.58% | -2.93% | -2.30% |
| Ares Management | 9.73% | 16.29% | 3.66% |
Summary
Ares Management beats Royalty Management on 11 of the 14 factors compared between the two stocks.
About Royalty Management
Royalty Management Holding Corporation provides environmental consulting and services in the United States. It is also involved in investing or purchasing assets, such as real estate and mining permits, patents, intellectual property, and emerging technologies. The company was incorporated in 2021 and is based in Fishers, Indiana.
About Ares Management
Ares Management Corporation operates as an alternative asset manager in the United States, Europe, and Asia. The company's Tradable Credit Group segment manages various types of investment funds, such as commingled and separately managed accounts for institutional investors, and publicly traded vehicles and sub-advised funds for retail investors in the tradable and non-investment grade corporate credit markets. Its Direct Lending Group segment provides financing solutions to small-to-medium sized companies. The company's Private Equity Group segment focuses on majority or shared-control investments primarily in under-capitalized companies. Its Real Estate Group segment invests in new developments and the repositioning of assets, with a focus on control or majority-control investments; and originates and invests in a range of self-originated financing opportunities for middle-market owners and operators of commercial real estate. The firm was previously known as Ares Management, L.P. Ares Management Corporation was founded in 1997 and is headquartered in Los Angeles, California with additional offices in the United States, Europe and Asia. Ares Management GP LLC is the general partner of the company.
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