Head to Head Analysis: Oaktree Capital Group (OAK) vs. Brookfield Asset Management (BAM)
Oaktree Capital Group (NYSE: OAK) and Brookfield Asset Management (NYSE:BAM) are both mid-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, institutional ownership, valuation, earnings, analyst recommendations, dividends and profitability.
Insider and Institutional Ownership
22.5% of Oaktree Capital Group shares are held by institutional investors. Comparatively, 53.8% of Brookfield Asset Management shares are held by institutional investors. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
This table compares Oaktree Capital Group and Brookfield Asset Management’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Oaktree Capital Group||19.17%||20.11%||4.95%|
|Brookfield Asset Management||4.87%||2.10%||0.84%|
Oaktree Capital Group pays an annual dividend of $5.24 per share and has a dividend yield of 11.5%. Brookfield Asset Management pays an annual dividend of $0.56 per share and has a dividend yield of 1.4%. Oaktree Capital Group pays out 114.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Brookfield Asset Management pays out 43.8% of its earnings in the form of a dividend. Oaktree Capital Group has raised its dividend for 5 consecutive years. Oaktree Capital Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This is a breakdown of recent ratings and target prices for Oaktree Capital Group and Brookfield Asset Management, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Oaktree Capital Group||1||5||2||0||2.13|
|Brookfield Asset Management||0||1||7||0||2.88|
Oaktree Capital Group presently has a consensus target price of $47.20, suggesting a potential upside of 3.62%. Brookfield Asset Management has a consensus target price of $43.56, suggesting a potential upside of 10.79%. Given Brookfield Asset Management’s stronger consensus rating and higher probable upside, analysts plainly believe Brookfield Asset Management is more favorable than Oaktree Capital Group.
Volatility & Risk
Oaktree Capital Group has a beta of 0.6, suggesting that its stock price is 40% less volatile than the S&P 500. Comparatively, Brookfield Asset Management has a beta of 1.03, suggesting that its stock price is 3% more volatile than the S&P 500.
Valuation & Earnings
This table compares Oaktree Capital Group and Brookfield Asset Management’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Oaktree Capital Group||$1.51 billion||1.94||$497.59 million||$4.57||9.97|
|Brookfield Asset Management||$30.02 billion||1.26||$8.47 billion||$1.28||30.72|
Brookfield Asset Management has higher revenue and earnings than Oaktree Capital Group. Oaktree Capital Group 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 Oaktree Capital Group on 9 of the 16 factors compared between the two stocks.
Oaktree Capital Group Company Profile
Oaktree Capital Group, LLC (Oaktree) is an investment manager specializing in alternative investments. The Company operates through investment management segment, which consists of the investment management services that the Company provides to its clients. The Company manages investments in a range of strategies within approximately six asset classes, which include corporate debt, convertible securities, distressed debt, control investing, real estate and listed equities. The Funds managed by Oaktree include commingled funds, separate accounts and collateralized loan obligation vehicles (CLOs). The commingled funds include open-end and closed-end limited partnerships in which it makes an investment and for which it serves as the general partner. CLOs are structured finance vehicles in which the Company typically makes an investment and for which it serves as collateral manager. Its clientele includes the United States pension plans and corporations and/or their pension funds.
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.
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