Ameriprise Financial (AMP) versus Saratoga Investment (SAR) Head to Head Survey

Ameriprise Financial (NYSE:AMP) and Saratoga Investment (NYSE:SAR) are both finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, risk, valuation, dividends, analyst recommendations, profitability and earnings.

Institutional and Insider Ownership

81.3% of Ameriprise Financial shares are held by institutional investors. Comparatively, 14.3% of Saratoga Investment shares are held by institutional investors. 1.5% of Ameriprise Financial shares are held by company insiders. Comparatively, 24.8% of Saratoga Investment shares are held by company 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 Ameriprise Financial and Saratoga Investment’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ameriprise Financial 13.91% 36.15% 1.48%
Saratoga Investment 50.76% 10.52% 4.12%

Dividends

Ameriprise Financial pays an annual dividend of $3.60 per share and has a dividend yield of 2.4%. Saratoga Investment pays an annual dividend of $2.08 per share and has a dividend yield of 9.0%. Ameriprise Financial pays out 29.3% of its earnings in the form of a dividend. Saratoga Investment pays out 91.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ameriprise Financial has increased its dividend for 8 consecutive years and Saratoga Investment has increased its dividend for 2 consecutive years.

Analyst Ratings

This is a summary of recent ratings and price targets for Ameriprise Financial and Saratoga Investment, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ameriprise Financial 0 5 3 0 2.38
Saratoga Investment 0 3 3 0 2.50

Ameriprise Financial presently has a consensus target price of $166.00, suggesting a potential upside of 10.98%. Saratoga Investment has a consensus target price of $23.83, suggesting a potential upside of 2.69%. Given Ameriprise Financial’s higher possible upside, research analysts plainly believe Ameriprise Financial is more favorable than Saratoga Investment.

Valuation and Earnings

This table compares Ameriprise Financial and Saratoga Investment’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Ameriprise Financial $12.03 billion 1.76 $1.48 billion $12.27 12.19
Saratoga Investment $38.62 million 4.48 $17.67 million $2.27 10.22

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

Risk and Volatility

Ameriprise Financial has a beta of 1.81, suggesting that its share price is 81% more volatile than the S&P 500. Comparatively, Saratoga Investment has a beta of 0.11, suggesting that its share price is 89% less volatile than the S&P 500.

Summary

Ameriprise Financial beats Saratoga Investment on 10 of the 16 factors compared between the two stocks.

Ameriprise Financial Company Profile

Ameriprise Financial, Inc., through its subsidiaries, provides various financial products and services to individual and institutional clients in the United States and internationally. It operates through Advice & Wealth Management, Asset Management, Annuities, and Protection segments. The Advice & Wealth Management segment provides financial planning and advice, as well as full-service brokerage services primarily to retail clients through its advisors. The Asset Management segment offers investment management and advice, and investment products to retail, high net worth, and institutional clients through unaffiliated third party financial institutions and institutional sales force. This segment's 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 funds. The Annuities segment provides variable and fixed annuity products to individual clients through affiliated and unaffiliated advisors, and financial institutions. The Protection segment offers various products to address the protection and risk management needs of retail clients, including life, disability income, and property casualty insurance through advisors and affinity relationships. 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.

Saratoga Investment Company Profile

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. It seeks to invest in the United States. The firm primarily invests $5 million to $20 million in companies having EBITDA of $2 million or greater and revenues of $8 million to $150 million. It invests through direct lending as well as participation in loan syndicates. The firm was formerly known as GSC Investment Corp. Saratoga Investment Corp. is based in New York, New York with an additional office in Florham Park, New Jersey.

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