Financial Analysis: Sound Point Meridian Capital (NYSE:SPMC) and Apollo Global Management (NYSE:APO)

Sound Point Meridian Capital (NYSE:SPMC) and Apollo Global Management (NYSE:APO) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, earnings, dividends, valuation, profitability and institutional ownership.

Dividends

Sound Point Meridian Capital pays an annual dividend of $3.00 per share and has a dividend yield of 22.2%. Apollo Global Management pays an annual dividend of $2.04 per share and has a dividend yield of 1.4%. Sound Point Meridian Capital pays out 1,500.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Apollo Global Management pays out 29.8% of its earnings in the form of a dividend. Apollo Global Management has increased its dividend for 3 consecutive years.

Valuation and Earnings

This table compares Sound Point Meridian Capital and Apollo Global Management”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sound Point Meridian Capital	N/A	N/A	N/A	$0.20	67.43
Apollo Global Management	$26.11 billion	3.26	$4.58 billion	$6.84	21.42

Apollo Global Management has higher revenue and earnings than Sound Point Meridian Capital. Apollo Global Management is trading at a lower price-to-earnings ratio than Sound Point Meridian Capital, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Sound Point Meridian Capital and Apollo Global Management’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sound Point Meridian Capital	N/A	N/A	N/A
Apollo Global Management	15.63%	15.43%	1.23%

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Sound Point Meridian Capital and Apollo Global Management, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sound Point Meridian Capital	1	1	2	0	2.25
Apollo Global Management	0	2	12	1	2.93

Sound Point Meridian Capital currently has a consensus price target of $18.90, suggesting a potential upside of 40.16%. Apollo Global Management has a consensus price target of $166.23, suggesting a potential upside of 13.46%. Given Sound Point Meridian Capital’s higher probable upside, equities research analysts clearly believe Sound Point Meridian Capital is more favorable than Apollo Global Management.

Volatility & Risk

Sound Point Meridian Capital has a beta of 0.25, meaning that its stock price is 75% less volatile than the S&P 500. Comparatively, Apollo Global Management has a beta of 1.61, meaning that its stock price is 61% more volatile than the S&P 500.

Insider & Institutional Ownership

77.1% of Apollo Global Management shares are owned by institutional investors. 0.9% of Sound Point Meridian Capital shares are owned by company insiders. Comparatively, 8.2% of Apollo Global Management shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

Apollo Global Management beats Sound Point Meridian Capital on 13 of the 16 factors compared between the two stocks.

About Sound Point Meridian Capital

Sound Point Meridian Capital Inc. is an externally managed, non-diversified closed-end management investment company. Its investment objective is to generate high current income, with a secondary objective to generate capital appreciation, by investing primarily in third-party collateralized loan obligation equity and mezzanine tranches. Sound Point Meridian Capital Inc. is based in NEW YORK.

About Apollo Global Management

Apollo Global Management, Inc. is a private equity firm specializing in investments in credit, private equity, infrastructure, secondaries and real estate markets. The firm prefers to invest in private and public markets. The firm’s private equity investments include traditional buyouts, recapitalization, distressed buyouts and debt investments in real estate, corporate partner buyouts, distressed asset, corporate carve-outs, middle market, growth, venture capital, turnaround, bridge, corporate restructuring, special situation, acquisition, and industry consolidation transactions. For credit strategies, the firm focuses to invest in multi-sector credit, semi-liquid credit, direct lending, first lien, unitranche, whole loans and private credit. The firm provides its services to endowment and sovereign wealth funds, as well as other institutional and individual investors. It manages client focused portfolios. The firm launches and manages hedge funds for its clients. It also manages real estate funds and private equity funds for its clients. The firm invests in the fixed income and alternative investment markets across the globe. Its fixed income investments include income-oriented senior loans, bonds, collateralized loan obligations, structured credit, opportunistic credit, non-performing loans, distressed debt, mezzanine debt, and value oriented fixed income securities. The firm seeks to invest in chemicals, commodities, consumer and retail, oil and gas, metals, mining, agriculture, commodities, distribution and transportation, financial and business services, manufacturing and industrial, media distribution, cable, entertainment and leisure, telecom, technology, natural resources, energy, packaging and materials, and satellite and wireless industries. It also focuses on clean energy, sustainable industry, climate solutions, energy transition, industrial decarbonization, sustainable mobility, sustainable resource use, and sustainable real estate. It seeks to invest in companies based in across Africa, Asia, North America with a focus on United States, Western Europe and Europe. It employs a combination of contrarian, value, and distressed strategies to make its investments. The firm seeks to make investments in the range of $75 million and $1500 million. The firm seeks to invest in companies with Enterprise value between $750 million to $2500 million. The firm conducts in-house research to create its investment portfolio. It seeks to acquire minority and majority positions in its portfolio companies. Apollo Global Management, Inc. was founded in 1990 and is headquartered in New York, New York with additional offices in North America, Asia, Africa and Europe.