UBS AG (NYSE: UBS) and American Capital (NASDAQ:ACAS) are both finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, dividends, profitabiliy, risk and valuation.
This table compares UBS AG and American Capital’s net margins, return on equity and return on assets.
Volatility & Risk
UBS AG has a beta of 1.24, suggesting that its stock price is 24% more volatile than the S&P 500. Comparatively, American Capital has a beta of 1, suggesting that its stock price has a similar volatility profile to the S&P 500.
Valuation & Earnings
This table compares UBS AG and American Capital’s top-line revenue, earnings per share (EPS) and valuation.
UBS AG has higher revenue and earnings than American Capital. American Capital is trading at a lower price-to-earnings ratio than UBS AG, indicating that it is currently the more affordable of the two stocks.
This is a summary of current recommendations for UBS AG and American Capital, as reported by MarketBeat.com.
American Capital has a consensus target price of $17.50, indicating a potential downside of 2.72%. Given American Capital’s higher possible upside, analysts clearly believe American Capital is more favorable than UBS AG.
Insider and Institutional Ownership
26.3% of UBS AG shares are owned by institutional investors. Comparatively, 65.7% of American Capital shares are owned by institutional investors. 1.0% of UBS AG shares are owned by company insiders. Comparatively, 9.2% of American Capital shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
UBS AG pays an annual dividend of $0.60 per share and has a dividend yield of 3.4%. American Capital does not pay a dividend. UBS AG pays out 56.6% of its earnings in the form of a dividend. UBS AG has raised its dividend for 4 consecutive years.
UBS AG Company Profile
UBS Group AG is a holding company and conducts its operations through UBS AG and its subsidiaries. The Company comprises Corporate Center and five business divisions: Wealth Management, Wealth Management Americas, Personal & Corporate Banking, Asset Management and the Investment Bank. Wealth Management division provides advice and tailored financial services to wealthy private clients around the world, except those served by Wealth Management Americas. Wealth Management Americas division is a wealth manager in the Americas in terms of financial advisor productivity and invested assets by financial advisor. Personal & Corporate Banking division provides financial products and services to private, corporate and institutional clients in Switzerland. Asset Management division provides investment management products and services, platform solutions and advisory support. Investment Bank division provides investment advice, financial solutions and capital markets access.
American Capital Company Profile
Acas LLC., formerly American Capital, Ltd. (American Capital) is a global asset manager and private equity firm. American Capital, both directly and through its asset management business, originates, underwrites and manages investments in middle market private equity, leveraged finance, real estate, energy and structured products. It primarily invests in senior and mezzanine debt and equity in buyouts of private companies sponsored by the Company (American Capital One Stop Buyouts) or sponsored by other private equity funds and provide capital directly to early-stage and mature private and small public companies (Sponsor Finance and Other Investments). It also invests in first and second lien floating rate loans to the United States-based companies (Senior Floating Rate Loans or SFRL) and structured finance investments (Structured Products), including collateralized loan obligation (CLO) securities and commercial mortgages, and commercial mortgage backed securities (CMBS).