Contrasting Associated Capital Group (NYSE:AC) and Ameriprise Financial (NYSE:AMP)

Associated Capital Group (NYSE:AC) and Ameriprise Financial (NYSE:AMP) are both finance companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, valuation, profitability, institutional ownership, earnings, risk and analyst recommendations.

Institutional and Insider Ownership

8.1% of Associated Capital Group shares are owned by institutional investors. Comparatively, 84.0% of Ameriprise Financial shares are owned by institutional investors. 88.7% of Associated Capital Group shares are owned by company insiders. Comparatively, 0.7% of Ameriprise Financial shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of recent recommendations and price targets for Associated Capital Group and Ameriprise Financial, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Associated Capital Group	0	0	0	0	0.00
Ameriprise Financial	2	4	1	1	2.13

Ameriprise Financial has a consensus target price of $534.71, suggesting a potential upside of 3.74%. Given Ameriprise Financial’s stronger consensus rating and higher possible upside, analysts clearly believe Ameriprise Financial is more favorable than Associated Capital Group.

Valuation and Earnings

This table compares Associated Capital Group and Ameriprise Financial”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Associated Capital Group	$11.91 million	58.69	$44.33 million	$2.53	13.09
Ameriprise Financial	$17.26 billion	2.81	$3.40 billion	$32.14	16.04

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Associated Capital Group	451.70%	5.98%	5.65%
Ameriprise Financial	18.30%	65.90%	2.02%

Dividends

Associated Capital Group pays an annual dividend of $0.20 per share and has a dividend yield of 0.6%. Ameriprise Financial pays an annual dividend of $6.40 per share and has a dividend yield of 1.2%. Associated Capital Group pays out 7.9% of its earnings in the form of a dividend. Ameriprise Financial pays out 19.9% 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. Ameriprise Financial has increased its dividend for 21 consecutive years. Ameriprise Financial is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility and Risk

Associated Capital Group has a beta of 0.57, suggesting that its stock price is 43% less volatile than the S&P 500. Comparatively, Ameriprise Financial has a beta of 1.24, suggesting that its stock price is 24% more volatile than the S&P 500.

Summary

Ameriprise Financial beats Associated Capital Group on 13 of the 18 factors compared between the two stocks.

About Associated Capital Group

Associated Capital Group, Inc., together with its subsidiaries, provides investment advisory services in the United States. The company offers alternative investment management services; and operates a direct investment business. It also invests in new and existing businesses. The company was founded in 1976 and is headquartered in Greenwich, Connecticut. Associated Capital Group, Inc. operates as a subsidiary of GGCP Holdings LLC.

About Ameriprise Financial

Ameriprise Financial, Inc., together with 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, advice, and products to retail, high net worth, and institutional clients through third-party financial institutions, advisor networks, direct retail, and its institutional sales force under the Columbia Threadneedle Investments brand name. This segment products 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, as well as life and disability income 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.