Analyzing Brookfield Asset Management (BAM) & Safeguard Scientifics (SFE)
Brookfield Asset Management (NYSE: BAM) and Safeguard Scientifics (NYSE:SFE) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, profitability, valuation, analyst recommendations, earnings, risk and institutional ownership.
Insider & Institutional Ownership
52.2% of Brookfield Asset Management shares are held by institutional investors. Comparatively, 77.5% of Safeguard Scientifics shares are held by institutional investors. 2.7% of Safeguard Scientifics shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
This table compares Brookfield Asset Management and Safeguard Scientifics’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Brookfield Asset Management||4.87%||2.10%||0.84%|
Brookfield Asset Management pays an annual dividend of $0.56 per share and has a dividend yield of 1.3%. Safeguard Scientifics does not pay a dividend. Brookfield Asset Management pays out 43.8% of its earnings in the form of a dividend. Safeguard Scientifics has increased its dividend for 5 consecutive years.
This is a summary of recent ratings for Brookfield Asset Management and Safeguard Scientifics, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Brookfield Asset Management||0||0||6||0||3.00|
Brookfield Asset Management presently has a consensus price target of $48.17, suggesting a potential upside of 13.87%. Given Brookfield Asset Management’s higher probable upside, equities research analysts clearly believe Brookfield Asset Management is more favorable than Safeguard Scientifics.
Risk and Volatility
Brookfield Asset Management has a beta of 1.05, indicating that its share price is 5% more volatile than the S&P 500. Comparatively, Safeguard Scientifics has a beta of 1.36, indicating that its share price is 36% more volatile than the S&P 500.
Valuation and Earnings
This table compares Brookfield Asset Management and Safeguard Scientifics’ top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Brookfield Asset Management||$24.41 billion||1.71||$1.65 billion||$1.28||33.05|
|Safeguard Scientifics||N/A||N/A||-$22.26 million||($4.49)||-2.95|
Brookfield Asset Management has higher revenue and earnings than Safeguard Scientifics. Safeguard Scientifics is trading at a lower price-to-earnings ratio than Brookfield Asset Management, indicating that it is currently the more affordable of the two stocks.
Brookfield Asset Management beats Safeguard Scientifics on 9 of the 14 factors compared between the two stocks.
Brookfield Asset Management Company Profile
Brookfield Asset Management Inc. is an alternative asset manager. The Company operates in eight segments. The Asset Management segment manages its listed partnerships, private funds and public markets on behalf of its clients. The Property segment includes the ownership, operation and development of office, retail and other properties. The Renewable power segment operates and develops hydroelectric, wind power and other generating facilities. The Infrastructure segment includes the ownership, operation and development of utilities and agricultural operations, among others. The Residential development segment includes homebuilding, condominium development and land development. The Service activities segment includes construction management and contracting services and property services. The Private equity segment includes the investments and operations overseen by its private equity group. The Corporate activities segment includes the allocation of capital to its operating platforms.
Safeguard Scientifics Company Profile
Safeguard Scientifics, Inc. is engaged in providing capital to technology companies within the fields of healthcare, financial services and digital media. The Company holds interest in companies, which it refers to as partner companies. As of December 31, 2016, the Company held interests in 29 non-consolidated partner companies. The Company offers operational and management support to each of its partner companies. In addition to management and operational support, the Company offers ongoing planning and development assessment. It provides mentoring, advice and guidance to develop partner company management. The Company serves on the boards of directors of its partner companies, working with them to develop and implement strategic and operating plans. It measures and monitors achievement of these plans through regular review of operational and financial performance measurements.
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