Acadian Asset Management Inc. (NYSE: AAMI)

Sector: Financial Services Industry: Asset Management CIK: 0001748824
Market Cap 4.14 Bn
P/B 3.82
P/E 4.20
P/S 8.60
ROIC (Qtr) 20.99
Div Yield % 0.10
Rev 1y % (Qtr) 17.14
Total Debt (Qtr) 336.90 Mn
Debt/Equity (Qtr) 3.03
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About

BrightSphere Investment Group Inc. (BSIG) is a global, diversified asset management company operating primarily in the institutional investment market. The company, which was previously known as OM Asset Management plc and BrightSphere Investment Group plc, was incorporated in England and Wales in 2014 and later changed its domicile to Delaware in 2019. BrightSphere Investment Group Inc. is subject to U.S. federal securities laws, state securities and corporate laws, and the rules and regulations of U.S. regulatory and self-regulatory organizations,...

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Investment thesis

Bull case

  • Free cash flow of (40.90M) provides excellent 45.44x coverage of dividends (900000), indicating sustainable shareholder returns.
  • Cash reserves of 138.70M provide comfortable 57.79x coverage of tax obligations 2.40M, showing strong fiscal management.
  • Strong tangible asset base of 731.10M provides 36.01x coverage of intangibles 20.30M, indicating robust asset quality.
  • Cash position of 138.70M fully covers payables of 56.80M by 2.44x, showing strong vendor relationship management.
  • Tangible assets of 731.10M provide robust 5.26x coverage of receivables 139M, showing strong asset quality.

Bear case

  • Operating cash flow of (30.20M) barely covers its investment activities of (42.90M), with a coverage ratio of 0.70, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Cash reserves of 138.70M provide limited coverage of acquisition spending of (49.80M), which is -2.79x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • The company's operating cash flow of (30.20M) shows concerning coverage of stock compensation expenses of 45.50M, with a -0.66 ratio indicating potential earnings quality issues.
  • Free cash flow of (40.90M) provides weak coverage of capital expenditures of 10.70M, with a -3.82 ratio suggesting additional external financing needs for growth initiatives.
  • Operating cash flow of (30.20M) provides minimal -0.79x coverage of tax expenses of 38M, suggesting potential tax planning inefficiencies or unsustainable tax positions.

Segments Breakdown of Revenue (2024)

Segments Breakdown of Revenue (2024)

Peer comparison

Companies in the Asset Management
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 BLK BlackRock, Inc. 199.59 Bn 85.40 21.98 15.04 Bn
2 BN BROOKFIELD Corp /ON/ 103.94 Bn 31.52 5.64 262.97 Bn
3 AMP Ameriprise Financial Inc 88.69 Bn 55.02 7.20 5.89 Bn
4 BX Blackstone Inc. 88.51 Bn 49.39 10.93 12.89 Bn
5 KKR KKR & Co. Inc. 55.86 Bn 28.33 13.23 53.12 Bn
6 STT State Street Corp 46.52 Bn 21.77 3.91 34.72 Bn
7 NTRS Northern Trust Corp 34.14 Bn 33.31 6.71 15.64 Bn
8 RJF Raymond James Financial Inc 32.89 Bn 37.63 4.14 5.10 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 4.65 0.94
EV to Cash from Ops. EV/CFO 256.84 41.10
EV to Debt EV to Debt 10.37 15.28
EV to EBIT EV/EBIT 3.12 23.47
EV to EBITDA EV/EBITDA 23.92 47.80
EV to Free Cash Flow [EV/FCF] EV/FCF -1,838.41 38.62
EV to Market Cap EV to Market Cap 0.84 7.81
EV to Revenue EV/Rev 7.25 27.38
Price to Book Value [P/B] P/B 3.82 2.34
Price to Earnings [P/E] P/E 4.20 11.81
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 97.56 4.66
Dividend Payout Ratio % Div Payout % (Qtr) 1.70 -5.56
Dividend per Basic Share Div per Share (Qtr) 0.04 1.73
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) -3.50 49.83
Interest Coverage Int. cover (Qtr) 7.59 25.16
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -1.90 -35.10
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 94.53 15.43
Dividend Growth (1y) % Div 1y % (Qtr) 0.00 1.65
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 29.06 -90.82
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 25.48 35.24
EBIT Growth (1y) % EBIT 1y % (Qtr) 23.85 -22.13
EBT Growth (1y) % EBT 1y % (Qtr) 29.03 -163.05
EPS Growth (1y) % EPS 1y % (Qtr) 41.92 -20.61
FCF Growth (1y) % FCF 1y % (Qtr) -138.19 220.21
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 19.25 -53.96
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.74 0.22
Cash Payout Ratio Cash Payout (Qtr) -0.05 0.36
Cash Ratio Cash Ratio 0.00 0.38
Current Ratio Current Ratio 0.00 0.86
Debt to Equity Ratio Debt/Equity (Qtr) 3.03 0.70
Interest Cover Ratio Int Coverage (Qtr) 7.59 25.16
Times Interest Earned Times Interest Earned (Qtr) 7.59 25.16
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 28.90 -114.76
EBIT Margin % EBIT Margin % (Qtr) 25.91 -127.24
EBT Margin % EBT Margin % (Qtr) 22.49 -150.97
Gross Margin % Gross Margin % (Qtr) 100.00 67.88
Net Profit Margin % Net Margin % (Qtr) 15.70 -148.68