AllianceBernstein Holding L.P. (NYSE: AB) and Ares Management L.P. (NYSE:ARES) are both finance companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, earnings, valuation, dividends, profitabiliy, risk and analyst recommendations.
Institutional and Insider Ownership
22.5% of AllianceBernstein Holding L.P. shares are owned by institutional investors. Comparatively, 14.6% of Ares Management L.P. shares are owned by institutional investors. 3.4% of AllianceBernstein Holding L.P. shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
This is a summary of current recommendations for AllianceBernstein Holding L.P. and Ares Management L.P., as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|AllianceBernstein Holding L.P.||0||1||3||0||2.75|
|Ares Management L.P.||0||2||6||0||2.75|
AllianceBernstein Holding L.P. currently has a consensus price target of $26.50, suggesting a potential upside of 10.42%. Ares Management L.P. has a consensus price target of $20.86, suggesting a potential upside of 15.55%. Given Ares Management L.P.’s higher probable upside, analysts plainly believe Ares Management L.P. is more favorable than AllianceBernstein Holding L.P..
Earnings & Valuation
This table compares AllianceBernstein Holding L.P. and Ares Management L.P.’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|AllianceBernstein Holding L.P.||$228.88 million||10.12||$208.38 million||$2.16||11.11|
|Ares Management L.P.||$1.30 billion||2.97||$241.00 million||$0.66||27.35|
Ares Management L.P. has higher revenue and earnings than AllianceBernstein Holding L.P.. AllianceBernstein Holding L.P. 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.
AllianceBernstein Holding L.P. pays an annual dividend of $1.84 per share and has a dividend yield of 7.7%. Ares Management L.P. pays an annual dividend of $0.52 per share and has a dividend yield of 2.9%. AllianceBernstein Holding L.P. pays out 85.2% 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 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.
This table compares AllianceBernstein Holding L.P. and Ares Management L.P.’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|AllianceBernstein Holding L.P.||9.74%||18.31%||18.31%|
|Ares Management L.P.||5.65%||35.09%||6.51%|
Volatility & Risk
AllianceBernstein Holding L.P. has a beta of 1.55, suggesting that its share price is 55% more volatile than the S&P 500. Comparatively, Ares Management L.P. has a beta of 1.24, suggesting that its share price is 24% more volatile than the S&P 500.
AllianceBernstein Holding L.P. beats Ares Management L.P. on 9 of the 15 factors compared between the two stocks.
About AllianceBernstein Holding L.P.
AllianceBernstein Holding L.P. is engaged in providing research, investment management and related services to a range of clients through its three buy-side distribution channels: Institutions, Retail and Private Wealth Management, and its sell-side business, Bernstein Research Services. The Company offers a range of investment services, including equity strategies, with global and regional portfolios across capitalization ranges and investment strategies, including value, growth and equities; traditional and unconstrained fixed income strategies, including taxable and tax-exempt strategies; passive management, including index and enhanced index strategies; alternative investments, including hedge funds, fund of funds and private equity, and multi-asset solutions and services, including dynamic asset allocation, customized target-date funds and target-risk funds. The Company’s services span various investment disciplines, including market capitalization, term and geographic locations.
About Ares Management L.P.
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.
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