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AMG vs. APO: Which Stock Should Value Investors Buy Now?

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Zacks Equity Research
·2 min read
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Investors with an interest in Financial - Investment Management stocks have likely encountered both Affiliated Managers Group (AMG) and Apollo Global Management, Inc. (APO). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Affiliated Managers Group and Apollo Global Management, Inc. are sporting Zacks Ranks of #1 (Strong Buy) and #3 (Hold), respectively, right now. Investors should feel comfortable knowing that AMG likely has seen a stronger improvement to its earnings outlook than APO has recently. However, value investors will care about much more than just this.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.

Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

AMG currently has a forward P/E ratio of 8.62, while APO has a forward P/E of 18.25. We also note that AMG has a PEG ratio of 0.54. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. APO currently has a PEG ratio of 0.76.

Another notable valuation metric for AMG is its P/B ratio of 1.90. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, APO has a P/B of 2.29.

Based on these metrics and many more, AMG holds a Value grade of A, while APO has a Value grade of D.

AMG is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that AMG is likely the superior value option right now.


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Affiliated Managers Group, Inc. (AMG) : Free Stock Analysis Report
 
Apollo Global Management, Inc. (APO) : Free Stock Analysis Report
 
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