Reviewing Apollo Global Management (NYSE:APO) & Cannae (NYSE:CNNE)

Apollo Global Management (NYSE:APO) and Cannae (NYSE:CNNE) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, dividends, institutional ownership, earnings, risk, analyst recommendations and valuation.

Earnings and Valuation

This table compares Apollo Global Management and Cannae”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Apollo Global Management	$27.47 billion	2.72	$4.58 billion	$6.84	19.09
Cannae	$452.50 million	1.69	-$304.60 million	($7.73)	-2.01

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

Institutional and Insider Ownership

77.1% of Apollo Global Management shares are held by institutional investors. Comparatively, 88.1% of Cannae shares are held by institutional investors. 8.2% of Apollo Global Management shares are held by company insiders. Comparatively, 10.9% of Cannae shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Apollo Global Management and Cannae’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Apollo Global Management	13.25%	13.38%	1.05%
Cannae	-108.39%	-23.16%	-18.38%

Dividends

Apollo Global Management pays an annual dividend of $2.04 per share and has a dividend yield of 1.6%. Cannae pays an annual dividend of $0.60 per share and has a dividend yield of 3.9%. Apollo Global Management pays out 29.8% of its earnings in the form of a dividend. Cannae pays out -7.8% 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. Apollo Global Management has increased its dividend for 3 consecutive years. Cannae is clearly the better dividend stock, given its higher yield and lower payout ratio.

Volatility and Risk

Apollo Global Management has a beta of 1.63, meaning that its stock price is 63% more volatile than the S&P 500. Comparatively, Cannae has a beta of 1.11, meaning that its stock price is 11% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and target prices for Apollo Global Management and Cannae, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Apollo Global Management	0	4	10	1	2.80
Cannae	1	1	2	0	2.25

Apollo Global Management currently has a consensus target price of $162.00, suggesting a potential upside of 24.08%. Cannae has a consensus target price of $20.50, suggesting a potential upside of 31.94%. Given Cannae’s higher probable upside, analysts clearly believe Cannae is more favorable than Apollo Global Management.

Summary

Apollo Global Management beats Cannae on 13 of the 18 factors compared between the two stocks.

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.

About Cannae

Cannae Holdings, Inc. is a principal investment firm. The firm primarily invests in restaurants, technology enabled healthcare services, financial services and more. It takes both minority and majority stakes. Cannae Holdings, Inc. was founded in 2014 and is based in Las Vegas, Nevada.