Ameriprise Financial Inc (NYSE: AMP)

Sector: Financial Services Industry: Asset Management CIK: 0000820027
Market Cap 57.57 Bn
P/B 11.49
P/E 15.13
P/S 4.22
ROIC (Qtr) 31.08
Div Yield % 1.24
Rev 1y % (Qtr) 8.96
Total Debt (Qtr) 5.89 Bn
Debt/Equity (Qtr) 0.91

About

Ameriprise Financial Inc., often referred to as Ameriprise, is a prominent player in the financial services industry with a rich history spanning nearly 130 years. The company operates as a holding company in Delaware, conducting its business primarily through its subsidiaries. Ameriprise's primary focus lies in providing financial planning and advice, offering a broad range of products and services tailored to assist individual and institutional clients in achieving their financial objectives. The company's operations are divided into two main...

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Price action

Investment thesis

Bull case

  • Strong operating cash flow of 6.04B provides robust 1.03x coverage of total debt 5.88B, indicating excellent debt servicing capability and financial flexibility.
  • Strong tangible asset base of 190.09B provides 32.30x coverage of total debt 5.88B, indicating robust asset backing and low credit risk.
  • Operating cash flow of 6.04B provides strong 30.18x coverage of stock compensation 200M, indicating sustainable incentive practices.
  • Operating cash flow of 6.04B provides exceptional 18.69x coverage of interest expenses 323M, showing strong debt service capability.
  • Strong operating cash flow of 6.04B provides 1.58x coverage of SG&A expenses 3.83B, showing efficient operational cost management.

Bear case

  • Operating cash flow of 6.04B barely covers its investment activities of (718M), with a coverage ratio of -8.41, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 6.04B provides thin coverage of dividend payments of (591M) with a -10.21 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Operating earnings of 4.89B show weak coverage of depreciation charges of (107M), with a -45.67 ratio indicating high capital intensity and potential reinvestment needs.
  • Retained earnings of 26.81B provide limited buffer against comprehensive income items of (969M), which is -27.66x, indicating elevated exposure to market risks.
  • Operating cash flow of 6.04B is outpaced by equity issuance of (2.68B) (-2.26 ratio), indicating concerning reliance on equity markets for funding operations.

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. 167.25 Bn 33.91 10.32 15.04 Bn
2 BX Blackstone Inc. 109.15 Bn 28.28 7.54 12.89 Bn
3 BN BROOKFIELD Corp /ON/ 104.56 Bn 38.54 5.48 262.97 Bn
4 KKR KKR & Co. Inc. 69.23 Bn 42.51 22.26 53.12 Bn
5 AMP Ameriprise Financial Inc 57.57 Bn 15.13 4.22 5.89 Bn
6 STT State Street Corp 49.14 Bn 24.46 4.18 34.72 Bn
7 NTRS Northern Trust Corp 35.31 Bn 47.16 8.54 15.64 Bn
8 RJF Raymond James Financial Inc 34.73 Bn 104.30 7.84 5.33 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.28 0.89
EV to Cash from Ops. EV/CFO 11.14 134.77
EV to Debt EV to Debt 8.96 13.62
EV to EBIT EV/EBIT 10.79 16.62
EV to EBITDA EV/EBITDA 10.73 20.25
EV to Free Cash Flow [EV/FCF] EV/FCF 11.48 149.47
EV to Market Cap EV to Market Cap 0.92 2.55
EV to Revenue EV/Rev 3.86 12.05
Price to Book Value [P/B] P/B 11.49 3.92
Price to Earnings [P/E] P/E 15.13 14.10
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 6.14 2.07
Dividend Payout Ratio % Div Payout % (Qtr) 16.60 -1.84
Dividend per Basic Share Div per Share (Qtr) 6.16 1.72
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 9.91 -102.04
Interest Coverage Int. cover (Qtr) 15.13 25.35
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -4.76 -35.71
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -8.43 33.38
Dividend Growth (1y) % Div 1y % (Qtr) 8.83 0.70
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 30.56 -5.22
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 33.52 33.83
EBIT Growth (1y) % EBIT 1y % (Qtr) 30.49 -4.60
EBT Growth (1y) % EBT 1y % (Qtr) 33.88 -45.43
EPS Growth (1y) % EPS 1y % (Qtr) 39.69 -3.59
FCF Growth (1y) % FCF 1y % (Qtr) -28.41 33.26
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 13.40 -1.73
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.09 0.22
Cash Payout Ratio Cash Payout (Qtr) 0.10 -1.06
Cash Ratio Cash Ratio 0.00 0.49
Current Ratio Current Ratio 0.00 1.01
Debt to Equity Ratio Debt/Equity (Qtr) 0.91 0.70
Interest Cover Ratio Int Coverage (Qtr) 15.13 25.35
Times Interest Earned Times Interest Earned (Qtr) 15.13 25.35
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 26.50 -113.47
EBIT Margin % EBIT Margin % (Qtr) 27.12 -124.18
EBT Margin % EBT Margin % (Qtr) 25.33 -147.97
Gross Margin % Gross Margin % (Qtr) 49.70 68.04
Net Profit Margin % Net Margin % (Qtr) 20.10 -145.75