Acadian Asset Management (NYSE:AAMI) & Houlihan Lokey (NYSE:HLI) Head to Head Review

Acadian Asset Management (NYSE:AAMI) and Houlihan Lokey (NYSE:HLI) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, institutional ownership, risk, dividends, analyst recommendations, earnings and valuation.

Earnings & Valuation

This table compares Acadian Asset Management and Houlihan Lokey”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Acadian Asset Management	$505.60 million	1.80	$85.00 million	$2.24	10.82
Houlihan Lokey	$2.24 billion	4.92	$280.30 million	$5.24	30.05

Houlihan Lokey has higher revenue and earnings than Acadian Asset Management. Acadian Asset Management is trading at a lower price-to-earnings ratio than Houlihan Lokey, indicating that it is currently the more affordable of the two stocks.

Dividends

Acadian Asset Management pays an annual dividend of $0.04 per share and has a dividend yield of 0.2%. Houlihan Lokey pays an annual dividend of $2.28 per share and has a dividend yield of 1.4%. Acadian Asset Management pays out 1.8% of its earnings in the form of a dividend. Houlihan Lokey pays out 43.5% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Acadian Asset Management and Houlihan Lokey, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Acadian Asset Management	0	1	0	0	2.00
Houlihan Lokey	2	3	1	0	1.83

Acadian Asset Management currently has a consensus target price of $27.00, indicating a potential upside of 11.43%. Houlihan Lokey has a consensus target price of $194.40, indicating a potential upside of 23.47%. Given Houlihan Lokey’s higher possible upside, analysts plainly believe Houlihan Lokey is more favorable than Acadian Asset Management.

Profitability

This table compares Acadian Asset Management and Houlihan Lokey’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Acadian Asset Management	16.81%	1,000.27%	18.11%
Houlihan Lokey	16.00%	20.04%	12.06%

Insider & Institutional Ownership

98.7% of Acadian Asset Management shares are owned by institutional investors. Comparatively, 78.1% of Houlihan Lokey shares are owned by institutional investors. 27.7% of Acadian Asset Management shares are owned by insiders. Comparatively, 23.7% of Houlihan Lokey shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Volatility and Risk

Acadian Asset Management has a beta of 1.54, indicating that its share price is 54% more volatile than the S&P 500. Comparatively, Houlihan Lokey has a beta of 0.72, indicating that its share price is 28% less volatile than the S&P 500.

About Acadian Asset Management

Acadian Asset Management Inc. is a publically owned asset management holding company. The firm provides its services to individuals and institutions. It manages separate client focused portfolios through its subsidiaries. The firm also launches equity mutual funds for its clients. It invests in public equity, fixed income, and alternative investment markets through its subsidiaries. The firm was founded in 1980 is based Boston, Massachusetts. It was formally known as BrightSphere Investment Group plc. BrightSphere Investment Group Inc. was formed in 1980 and is based in Boston, Massachusetts.

About Houlihan Lokey

Houlihan Lokey, Inc., an investment banking company, provides merger and acquisition (M&A), capital market, financial restructuring, and financial and valuation advisory services worldwide. It operates in three segments: Corporate Finance, Financial Restructuring, and Financial and Valuation Advisory. The Corporate Finance segment offers general financial advisory services; and advises public and private institutions on buy-side and sell-side transactions, leveraged loans, private mezzanine debt, high-yield debt, initial public offerings, follow-ons, convertibles, equity private placements, private equity, and liability management transactions, as well as advise financial sponsors on various transactions. The Financial Restructuring segment advises debtors, creditors, and other parties-in-interest related to recapitalization/deleveraging transactions. It also provides a range of advisory services, including structuring, negotiation, and confirmation of plans of reorganization; structuring and analysis of exchange offers; corporate viability assessment; dispute resolution and expert testimony; and procuring debtor-in-possession financing. The Financial and Valuation Advisory segment offers valuations of various assets, such as companies, illiquid debt and equity securities, and intellectual property. It also provides fairness opinions in connection with M&A and other transactions, solvency opinions in connection with corporate spin-offs and dividend recapitalizations, and other types of financial opinions. In addition, this segment offers dispute resolution services. It serves corporations, financial sponsors, and government agencies. The company was incorporated in 1972 and is headquartered in Los Angeles, California.