Eagle Point Credit (NYSE: ECC) and Artisan Partners Asset Management (NYSE:APAM) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their profitability, valuation, risk, dividends, earnings, analyst recommendations and institutional ownership.
This is a breakdown of current recommendations for Eagle Point Credit and Artisan Partners Asset Management, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Eagle Point Credit||0||0||4||0||3.00|
|Artisan Partners Asset Management||1||2||2||0||2.20|
Institutional and Insider Ownership
57.1% of Eagle Point Credit shares are owned by institutional investors. Comparatively, 64.0% of Artisan Partners Asset Management shares are owned by institutional investors. 0.6% of Eagle Point Credit shares are owned by insiders. Comparatively, 30.0% of Artisan Partners Asset Management shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Risk & Volatility
Eagle Point Credit has a beta of 0.21, meaning that its share price is 79% less volatile than the S&P 500. Comparatively, Artisan Partners Asset Management has a beta of 1.75, meaning that its share price is 75% more volatile than the S&P 500.
Earnings and Valuation
This table compares Eagle Point Credit and Artisan Partners Asset Management’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Eagle Point Credit||$65.29 million||5.11||$31.13 million||$1.73||10.27|
|Artisan Partners Asset Management||$795.60 million||3.17||$49.59 million||$0.76||43.16|
Artisan Partners Asset Management has higher revenue and earnings than Eagle Point Credit. Eagle Point Credit is trading at a lower price-to-earnings ratio than Artisan Partners Asset Management, indicating that it is currently the more affordable of the two stocks.
This table compares Eagle Point Credit and Artisan Partners Asset Management’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Eagle Point Credit||47.68%||10.46%||7.06%|
|Artisan Partners Asset Management||6.23%||119.11%||15.38%|
Eagle Point Credit pays an annual dividend of $2.40 per share and has a dividend yield of 13.5%. Artisan Partners Asset Management pays an annual dividend of $2.40 per share and has a dividend yield of 7.3%. Eagle Point Credit pays out 138.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Artisan Partners Asset Management pays out 315.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Eagle Point Credit is clearly the better dividend stock, given its higher yield and lower payout ratio.
About Eagle Point Credit
Eagle Point Credit Company Inc. is a non-diversified, closed-end management investment company. The Company’s primary investment objective is to generate high current income, with a secondary objective to generate capital appreciation. The Company primarily invests in equity and junior debt tranches of collateralized loan obligations (CLOs) that are collateralized by a portfolio consisting primarily of the below investment grade United States senior secured loans. It may also invest in other securities and instruments related to these investments. The Company’s portfolio includes its investments in various industries, such as business equipment and services; healthcare; electronics/electrical; leisure goods/activities/movies; retailers (except food and drug); chemicals and plastics; telecommunications; financial intermediaries, and utilities. The Company’s advisor is Eagle Point Credit Management LLC.
About Artisan Partners Asset Management
Artisan Partners Asset Management Inc. is an investment management company. The Company provides a range of the United States, non-United States and global investment strategies, each of which is managed by one of its investment teams. The Company provides investment management services to separate accounts, mutual funds and other pooled investment vehicles. The Company offers its investment management services primarily to institutions and through intermediaries that operate with institutional-like decision-making processes and have long-term investment horizons. The Company provides clients with multiple equity investment strategies spanning market capitalization segments and investing styles in both the United States and non-United States markets. The Company also offers one fixed income strategy, the Artisan High Income strategy. Each strategy is managed by one of the investment teams.
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