StepStone Group (NASDAQ:STEP) vs. Acadian Asset Management (NYSE:AAMI) Financial Analysis

StepStone Group (NASDAQ:STEP) and Acadian Asset Management (NYSE:AAMI) are both finance companies, but which is the better business? We will compare the two companies based on the strength of their risk, institutional ownership, valuation, dividends, analyst recommendations, profitability and earnings.

Dividends

StepStone Group pays an annual dividend of $1.12 per share and has a dividend yield of 1.8%. Acadian Asset Management pays an annual dividend of $0.04 per share and has a dividend yield of 0.1%. StepStone Group pays out -36.4% of its earnings in the form of a dividend. Acadian Asset Management pays out 1.7% 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. StepStone Group has increased its dividend for 3 consecutive years. StepStone Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility & Risk

StepStone Group has a beta of 1.37, meaning that its share price is 37% more volatile than the S&P 500. Comparatively, Acadian Asset Management has a beta of 1.42, meaning that its share price is 42% more volatile than the S&P 500.

Insider and Institutional Ownership

55.5% of StepStone Group shares are owned by institutional investors. Comparatively, 98.7% of Acadian Asset Management shares are owned by institutional investors. 16.5% of StepStone Group shares are owned by insiders. Comparatively, 26.0% of Acadian Asset Management shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for StepStone Group and Acadian Asset Management, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
StepStone Group	0	5	3	0	2.38
Acadian Asset Management	0	2	1	0	2.33

StepStone Group currently has a consensus price target of $64.00, suggesting a potential upside of 5.26%. Acadian Asset Management has a consensus price target of $40.00, suggesting a potential downside of 17.27%. Given StepStone Group’s stronger consensus rating and higher probable upside, analysts clearly believe StepStone Group is more favorable than Acadian Asset Management.

Profitability

This table compares StepStone Group and Acadian Asset Management’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
StepStone Group	-17.10%	16.07%	5.30%
Acadian Asset Management	16.65%	174.31%	17.56%

Earnings and Valuation

This table compares StepStone Group and Acadian Asset Management”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
StepStone Group	$1.17 billion	6.02	-$179.56 million	($3.08)	-19.74
Acadian Asset Management	$505.60 million	3.42	$85.00 million	$2.40	20.15

Acadian Asset Management has lower revenue, but higher earnings than StepStone Group. StepStone Group is trading at a lower price-to-earnings ratio than Acadian Asset Management, indicating that it is currently the more affordable of the two stocks.

Summary

Acadian Asset Management beats StepStone Group on 9 of the 17 factors compared between the two stocks.

About StepStone Group

StepStone Group Inc. is a private equity and venture capital firm specializing in direct, fund of funds, secondary direct, and secondary indirect investments. For direct investment, it seeks to invest in private debt, venture debt, incubation, mezzanine, distressed/vulture, seed/startup, early venture, mid venture, late venture, emerging growth, later stage, turnaround, growth capital, industry consolidation, recapitalization, buyout investments in mature and middle market companies. It prefers to invest in natural resources, technology, healthcare, services, materials, manufacturing, consumer durables, apparel, hotels, restaurants and leisure, media, retailing, power, utilities consumer staples, financials, telecommunication services, clean energy/renewables, transport, social, natural capital, infrastructure, corporate, real estate, credit and real asset. The firm invests globally with a focus on United States, North America, Europe, Asia, Latin America, Middle East, Africa, Brazil, Mexico, Argentina, Colombia, New Zealand, China, India, Korea, Japan, Taiwan, and Australia region. The firm invests between 5% and 40% in emerging markets. For fund of fund investment, it seeks to invest in private equity funds, venture capital funds, Special situation funds, Real estate funds, Infrastructure funds, mezzanine funds, and turnaround/distressed funds. It considers investments in both domestic and international funds. It also seeks to make co-investments and follow-on investments and considers partial interests in funds. StepStone Group Inc. was founded in 2007 and is based in New York, New York with additional offices across North America, South America, Europe, Australia and Asia.

About Acadian Asset Management

Acadian Asset Management Inc. is a publically owned asset management holding company. The firm provides its services to individuals and institutions. It manages separate client focused portfolios through its subsidiaries. The firm also launches equity mutual funds for its clients. It invests in public equity, fixed income, and alternative investment markets through its subsidiaries. The firm was founded in 1980 is based Boston, Massachusetts. It was formally known as BrightSphere Investment Group plc. BrightSphere Investment Group Inc. was formed in 1980 and is based in Boston, Massachusetts.