Head to Head Review: Oppenheimer (NYSE:OPY) versus Ameriprise Financial (NYSE:AMP)

Oppenheimer (NYSE:OPY) and Ameriprise Financial (NYSE:AMP) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, valuation, analyst recommendations, earnings, risk and institutional ownership.

Insider and Institutional Ownership

32.3% of Oppenheimer shares are owned by institutional investors. Comparatively, 84.0% of Ameriprise Financial shares are owned by institutional investors. 34.9% of Oppenheimer shares are owned by company insiders. Comparatively, 0.6% of Ameriprise Financial 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.

Dividends

Oppenheimer pays an annual dividend of $0.80 per share and has a dividend yield of 0.9%. Ameriprise Financial pays an annual dividend of $6.80 per share and has a dividend yield of 1.3%. Oppenheimer pays out 10.8% of its earnings in the form of a dividend. Ameriprise Financial pays out 15.3% 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. Oppenheimer has raised its dividend for 1 consecutive years and Ameriprise Financial has raised its dividend for 21 consecutive years. Ameriprise Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings & Valuation

This table compares Oppenheimer and Ameriprise Financial”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Oppenheimer	$1.64 billion	0.59	$148.40 million	$7.43	12.22
Ameriprise Financial	$18.48 billion	2.45	$3.56 billion	$44.45	11.76

Ameriprise Financial has higher revenue and earnings than Oppenheimer. Ameriprise Financial is trading at a lower price-to-earnings ratio than Oppenheimer, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Oppenheimer and Ameriprise Financial, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Oppenheimer	0	0	3	0	3.00
Ameriprise Financial	2	5	4	1	2.33

Ameriprise Financial has a consensus target price of $557.00, suggesting a potential upside of 6.58%. Given Ameriprise Financial’s higher probable upside, analysts plainly believe Ameriprise Financial is more favorable than Oppenheimer.

Profitability

This table compares Oppenheimer and Ameriprise Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Oppenheimer	4.94%	19.02%	4.75%
Ameriprise Financial	20.99%	69.94%	2.22%

Volatility and Risk

Oppenheimer has a beta of 1.12, meaning that its share price is 12% more volatile than the S&P 500. Comparatively, Ameriprise Financial has a beta of 1.13, meaning that its share price is 13% more volatile than the S&P 500.

Summary

Ameriprise Financial beats Oppenheimer on 13 of the 18 factors compared between the two stocks.

About Oppenheimer

Oppenheimer Holdings Inc. operates as a middle-market investment bank and full-service broker-dealer in the Americas, Europe, the Middle East, and Asia. The company provides brokerage services covering corporate equity and debt securities, money market instruments, exchange-traded options and futures contracts, municipal bonds, mutual funds, exchange-traded funds, and unit investment trusts; financial and wealth planning services; and margin lending services. It offers asset management services, including separately managed accounts, mutual fund managed accounts, discretionary portfolio management programs, non-discretionary investment advisory and consultation services, alternative investments, portfolio enhancement programs, and institutional taxable fixed income portfolio management strategies and solutions, as well as taxable and non-taxable fixed income portfolios and strategies. In addition, the company offers investment banking services, such as strategic advisory services and capital markets products; merger and acquisition, equities capital market, debt capital market, debt advisory and restructuring, and fund placement services; and institutional equity sales and trading, equity research, equity derivatives and index options, convertible bonds, event driven sales and trading, and portfolio and electronic trading. Further, it provides institutional fixed income sales and trading, fixed income research, public finance, and municipal trading services; and proprietary trading and investment activities. Additionally, the company offers underwriting, market-making, trust, and discount services, as well as a cloud-based financial market. It serves high-net-worth individuals and families, corporate executives, public and private businesses, institutions and corporations, governments, financial sponsors, and domestic and international investors. Oppenheimer Holdings Inc. was founded in 1881 and is headquartered in New York, New York.

About Ameriprise Financial

Ameriprise Financial, Inc., together with its subsidiaries, provides various financial products and services to individual and institutional clients in the United States and internationally. It operates through four segments: Advice & Wealth Management, Asset Management, Retirement & Protection Solutions, and Corporate & Other. The Advice & Wealth Management segment provides financial planning and advice; brokerage products and services for retail and institutional clients; discretionary and non-discretionary investment advisory accounts; mutual funds; insurance and annuities products; cash management and banking products; and face-amount certificates. The Asset Management segment offers investment management, advice, and products to retail, high net worth, and institutional clients through third-party financial institutions, advisor networks, direct retail, and its institutional sales force under the Columbia Threadneedle Investments brand name. This segment products include U.S. mutual funds and their non-U.S. equivalents, exchange-traded funds, variable product funds underlying insurance, and annuity separate accounts; and institutional asset management products, such as traditional asset classes, separately managed accounts, individually managed accounts, collateralized loan obligations, hedge funds, collective funds, and property and infrastructure funds. The Retirement & Protection Solutions segment provides variable annuity products, as well as life and disability income insurance products to retail clients. The company was formerly known as American Express Financial Corporation and changed its name to Ameriprise Financial, Inc. in September 2005. Ameriprise Financial, Inc. was founded in 1894 and is headquartered in Minneapolis, Minnesota.