Head-To-Head Survey: Saratoga Investment (NYSE:SAR) vs. Acadian Asset Management (NYSE:AAMI)

Acadian Asset Management (NYSE:AAMI) and Saratoga Investment (NYSE:SAR) are both small-cap finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, risk, profitability, dividends, earnings, valuation and institutional ownership.

Insider & Institutional Ownership

98.7% of Acadian Asset Management shares are held by institutional investors. Comparatively, 19.1% of Saratoga Investment shares are held by institutional investors. 26.0% of Acadian Asset Management shares are held by insiders. Comparatively, 12.0% of Saratoga Investment shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Acadian Asset Management	16.81%	1,000.27%	18.11%
Saratoga Investment	22.01%	15.53%	4.80%

Volatility & Risk

Acadian Asset Management has a beta of 1.36, indicating that its share price is 36% more volatile than the S&P 500. Comparatively, Saratoga Investment has a beta of 0.68, indicating that its share price is 32% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and target prices for Acadian Asset Management and Saratoga Investment, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Acadian Asset Management	0	3	0	0	2.00
Saratoga Investment	0	4	0	0	2.00

Acadian Asset Management presently has a consensus target price of $25.67, indicating a potential downside of 18.23%. Saratoga Investment has a consensus target price of $24.25, indicating a potential upside of 0.70%. Given Saratoga Investment’s higher possible upside, analysts plainly believe Saratoga Investment is more favorable than Acadian Asset Management.

Dividends

Acadian Asset Management pays an annual dividend of $0.04 per share and has a dividend yield of 0.1%. Saratoga Investment pays an annual dividend of $3.00 per share and has a dividend yield of 12.5%. Acadian Asset Management pays out 1.7% of its earnings in the form of a dividend. Saratoga Investment pays out 147.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Earnings & Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Acadian Asset Management	$519.80 million	2.16	$85.00 million	$2.41	13.02
Saratoga Investment	$42.10 million	8.79	$8.93 million	$2.04	11.80

Acadian Asset Management has higher revenue and earnings than Saratoga Investment. Saratoga Investment 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 Saratoga Investment on 10 of the 14 factors compared between the two stocks.

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.

About Saratoga Investment

Saratoga Investment Corp. is a business development company specializing in leveraged and management buyouts, acquisition financings, growth financings, recapitalization, debt refinancing, and transitional financing transactions at the lower end of middle market companies. It structures its investments as debt and equity by investing through first and second lien loans, mezzanine debt, co-investments, select high yield bonds, senior secured bonds, unsecured bonds, and preferred and common equity. The firm prefers to invest in aerospace, automotive aftermarket and services, business products and services, consumer products and services, education, environmental services, industrial services, financial services, food and beverage, healthcare products and services, logistics, distribution, manufacturing, restaurants services, food services, software services, technology services, specialty chemical, media and telecommunications. It seeks to invest in the United States. The firm primarily invests $5 million to $50 million in companies having EBITDA of $2 million or greater and revenues of $8 million to $250 million. The firm prefer to take a majority stake. It invests through direct lending as well as participation in loan syndicates. The firm was formerly known as GSC Investment Corp. Saratoga Investment Corp. was formed on 2007 and is based in New York, New York with an additional office in Florham Park, New Jersey.