Ameriprise Financial (NYSE:AMP) vs. Grosvenor Capital Management (NASDAQ:GCMG) Head to Head Review

Ameriprise Financial (NYSE:AMPGet Rating) and Grosvenor Capital Management (NASDAQ:GCMGGet Rating) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, analyst recommendations, institutional ownership, dividends, profitability, valuation and risk.

Insider & Institutional Ownership

82.7% of Ameriprise Financial shares are held by institutional investors. Comparatively, 21.6% of Grosvenor Capital Management shares are held by institutional investors. 1.0% of Ameriprise Financial shares are held by insiders. Comparatively, 77.3% of Grosvenor Capital Management shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares Ameriprise Financial and Grosvenor Capital Management’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Ameriprise Financial $13.43 billion 2.24 $2.76 billion $26.04 10.53
Grosvenor Capital Management $531.59 million 2.92 $21.48 million $0.38 21.68

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

Volatility and Risk

Ameriprise Financial has a beta of 1.5, indicating that its stock price is 50% more volatile than the S&P 500. Comparatively, Grosvenor Capital Management has a beta of 0.19, indicating that its stock price is 81% less volatile than the S&P 500.

Dividends

Ameriprise Financial pays an annual dividend of $5.00 per share and has a dividend yield of 1.8%. Grosvenor Capital Management pays an annual dividend of $0.40 per share and has a dividend yield of 4.9%. Ameriprise Financial pays out 19.2% of its earnings in the form of a dividend. Grosvenor Capital Management pays out 105.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ameriprise Financial has raised its dividend for 18 consecutive years.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Ameriprise Financial and Grosvenor Capital Management, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ameriprise Financial 1 1 8 0 2.70
Grosvenor Capital Management 0 1 2 0 2.67

Ameriprise Financial currently has a consensus price target of $345.89, suggesting a potential upside of 26.08%. Grosvenor Capital Management has a consensus price target of $11.00, suggesting a potential upside of 33.50%. Given Grosvenor Capital Management’s higher possible upside, analysts clearly believe Grosvenor Capital Management is more favorable than Ameriprise Financial.

Profitability

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

Net Margins Return on Equity Return on Assets
Ameriprise Financial 22.45% 50.02% 1.61%
Grosvenor Capital Management 4.43% -183.85% 21.73%

Summary

Ameriprise Financial beats Grosvenor Capital Management on 11 of the 17 factors compared between the two stocks.

Ameriprise Financial Company Profile (Get Rating)

Ameriprise Financial, Inc., through 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 and advice, and investment products to retail, high net worth, and institutional clients through unaffiliated third-party financial institutions and institutional sales force. This segment products also 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 to individual clients, as well as life and DI 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.

Grosvenor Capital Management Company Profile (Get Rating)

Grosvenor Capital Management, L.P. is global alternative asset management solutions provider. The firm primarily provides its services to pooled investment vehicles. It also provides its services to investment companies, high net worth individuals, pension and profit sharing plans and state or municipal government entities. The firm invests in equity and alternative investment markets of the United States and internationally. The firm invests in multi-strategy, credit-focused, equity-focused, macro-focused, commodity-focused, and other specialty portfolios. It focuses in hedge fund asset classes, private equity, real estate, and/or infrastructure, credit and absolute return strategies. It also focuses in primary fund investments, secondary fund investments, and co-investments with a focus on buyout, distressed debt, mezzanine, venture capital/growth equity investments. The firm seeks to make regionally-focused investments in middle-market buyout. It prefers to invest in aerospace and defense, advanced electronics, information technology, biosciences, and advanced materials. It focuses on Ohio and the Midwest region. The firm employs fundamental and quantitative analysis. Grosvenor Capital Management, L.P. was founded in 1971 and is based in Chicago, Illinois with additional offices in North America, Asia and Europe.

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