OM Asset Management PLC (NYSE: OMAM) and Medley Management (NYSE:MDLY) are both small-cap finance companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, analyst recommendations, dividends, valuation, risk, institutional ownership and earnings.

Dividends

OM Asset Management PLC pays an annual dividend of $0.36 per share and has a dividend yield of 2.4%. Medley Management pays an annual dividend of $0.80 per share and has a dividend yield of 12.5%. OM Asset Management PLC pays out 45.6% of its earnings in the form of a dividend. Medley Management pays out 421.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Risk & Volatility

OM Asset Management PLC has a beta of 1.74, indicating that its share price is 74% more volatile than the S&P 500. Comparatively, Medley Management has a beta of 1.36, indicating that its share price is 36% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current recommendations and price targets for OM Asset Management PLC and Medley Management, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
OM Asset Management PLC 0 0 6 0 3.00
Medley Management 0 3 0 0 2.00

OM Asset Management PLC currently has a consensus price target of $17.88, indicating a potential upside of 20.05%. Medley Management has a consensus price target of $9.75, indicating a potential upside of 52.34%. Given Medley Management’s higher probable upside, analysts plainly believe Medley Management is more favorable than OM Asset Management PLC.

Institutional & Insider Ownership

66.0% of OM Asset Management PLC shares are held by institutional investors. Comparatively, 65.6% of Medley Management shares are held by institutional investors. 1.5% of OM Asset Management PLC shares are held by insiders. Comparatively, 5.1% of Medley Management shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares OM Asset Management PLC and Medley Management’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
OM Asset Management PLC 12.12% 95.51% 12.52%
Medley Management 2.68% -43.71% 17.11%

Valuation and Earnings

This table compares OM Asset Management PLC and Medley Management’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
OM Asset Management PLC $772.40 million 2.12 $173.80 million $0.79 18.85
Medley Management $67.57 million 0.50 $27.69 million $0.19 33.69

OM Asset Management PLC has higher revenue and earnings than Medley Management. OM Asset Management PLC is trading at a lower price-to-earnings ratio than Medley Management, indicating that it is currently the more affordable of the two stocks.

Summary

OM Asset Management PLC beats Medley Management on 11 of the 16 factors compared between the two stocks.

OM Asset Management PLC Company Profile

OM Asset Management plc is a global, diversified, multi-boutique asset management company. As of December 31, 2016, the Company operated its business through its eight Affiliates, each of which operated autonomously and employed its own investment processes. Its Affiliates include Acadian Asset Management LLC; Barrow, Hanley, Mewhinney & Strauss, LLC; Campbell Global, LLC; Copper Rock Capital Partners LLC; Heitman LLC; Investment Counselors of Maryland, LLC; Landmark Partners, LLC, and Thompson, Siegel & Walmsley LLC. It works with boutique asset managers, and the Company leverages the resources within its organization to engage with its Affiliates and provide them with capabilities unavailable to specialist asset management firms. The Company works with its Affiliates to identify and execute upon opportunities for their businesses in areas, such as business line expansion and product development, as well as activities required for the operation of investment boutiques.

Medley Management Company Profile

Medley Management Inc. is an asset management firm offering yield solutions to retail and institutional investors. The Company operates in the investment management segment. It is focused on credit-related investment strategies, primarily originating senior secured loans to private middle market companies in the United States. The Company generally holds these loans to maturity. Its national direct origination franchise provides capital to the middle market in the United States. The Company has over $4.8 billion of assets under management (AUM) in approximately two business development companies (BDCs), Medley Capital Corporation (MCC) and Sierra Income Corporation (SIC), as well as private investment vehicles. It has over $5 billion of AUM. The Company provides capital to over 300 companies across approximately 35 industries in North America. The Company’s long-dated private funds include MOF I, MOF II and MOF III. Its private funds are managed through partnership structures

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