Apollo Global Management (NYSE: APO) and Fortress Investment Group (NYSE:FIG) are both mid-cap financials companies, but which is the superior stock? We will compare the two businesses based on the strength of their profitability, dividends, risk, earnings, analyst recommendations, valuation and institutional ownership.
This is a breakdown of recent recommendations for Apollo Global Management and Fortress Investment Group, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Apollo Global Management||0||3||7||0||2.70|
|Fortress Investment Group||0||0||0||0||N/A|
Valuation & Earnings
This table compares Apollo Global Management and Fortress Investment Group’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Apollo Global Management||$2.61 billion||2.59||$629.10 million||$4.34||7.73|
|Fortress Investment Group||$1.16 billion||2.62||$180.64 million||$0.69||11.38|
Apollo Global Management has higher revenue and earnings than Fortress Investment Group. Apollo Global Management is trading at a lower price-to-earnings ratio than Fortress Investment Group, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
70.5% of Apollo Global Management shares are owned by institutional investors. Comparatively, 40.0% of Fortress Investment Group shares are owned by institutional investors. 4.1% of Apollo Global Management shares are owned by insiders. Comparatively, 45.2% of Fortress Investment Group shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Volatility and Risk
Apollo Global Management has a beta of 1.06, meaning that its stock price is 6% more volatile than the S&P 500. Comparatively, Fortress Investment Group has a beta of 1.89, meaning that its stock price is 89% more volatile than the S&P 500.
This table compares Apollo Global Management and Fortress Investment Group’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Apollo Global Management||23.92%||62.94%||21.83%|
|Fortress Investment Group||74.41%||58.24%||35.03%|
Apollo Global Management pays an annual dividend of $2.64 per share and has a dividend yield of 7.9%. Fortress Investment Group pays an annual dividend of $0.18 per share and has a dividend yield of 2.3%. Apollo Global Management pays out 60.8% of its earnings in the form of a dividend. Fortress Investment Group pays out 26.1% 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. Apollo Global Management has raised its dividend for 2 consecutive years. Apollo Global Management is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Apollo Global Management beats Fortress Investment Group on 9 of the 16 factors compared between the two stocks.
Apollo Global Management Company Profile
Apollo Global Management, LLC (Apollo) is an alternative investment manager in private equity, credit and real estate. The Company raises, invests and manages funds on behalf of pension, endowment and sovereign wealth funds, as well as other institutional and individual investors. The Company’s segments include private equity, credit and real estate. The private equity segment invests in control equity and related debt instruments, convertible securities and distressed debt investments. The credit segment invests in non-control corporate and structured debt instruments, including performing, stressed and distressed investments across the capital structure. The real estate segment invests in real estate equity for the acquisition and recapitalization of real estate assets, portfolios, platforms and operating companies, and real estate debt, including first mortgage and mezzanine loans, preferred equity and commercial mortgage backed securities.
Fortress Investment Group Company Profile
Fortress Investment Group LLC (Fortress) is an investment management firm. The Company operates through segments, including private equity funds, permanent capital vehicles, credit hedge funds, credit PE funds, liquid hedge funds and Logan Circle. Its business is to sponsor the formation of, and provide investment management services for, various investment funds, permanent capital vehicles and related managed accounts (the Fortress Funds). Fortress’s sources of income from the Fortress Funds are management fees, incentive income and investment income on its investments in the funds. As of December 31, 2016, the Company’s private equity business manages approximately $13.5 billion of assets under management (AUM); credit funds business manages approximately $18.1 billion of AUM; liquid hedge funds business manages over $4.6 billion of AUM, and Logan Circle business manages approximately $33.4 billion of AUM.
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