AllianceBernstein (AB) versus Blackstone Group (BX) Financial Analysis

AllianceBernstein (NYSE: AB) and Blackstone Group (NYSE:BX) are both mid-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, institutional ownership, earnings, risk, analyst recommendations, valuation and dividends.

Analyst Recommendations

This is a summary of current recommendations and price targets for AllianceBernstein and Blackstone Group, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AllianceBernstein 0 1 4 0 2.80
Blackstone Group 0 1 8 0 2.89

AllianceBernstein presently has a consensus price target of $27.50, suggesting a potential upside of 8.27%. Blackstone Group has a consensus price target of $38.56, suggesting a potential upside of 21.63%. Given Blackstone Group’s stronger consensus rating and higher possible upside, analysts plainly believe Blackstone Group is more favorable than AllianceBernstein.

Valuation & Earnings

This table compares AllianceBernstein and Blackstone Group’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
AllianceBernstein $3.03 billion 0.79 $216.58 million $2.12 11.98
Blackstone Group $5.13 billion 3.90 $1.04 billion $2.31 13.72

Blackstone Group has higher revenue and earnings than AllianceBernstein. AllianceBernstein is trading at a lower price-to-earnings ratio than Blackstone Group, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares AllianceBernstein and Blackstone Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AllianceBernstein 6.38% 13.72% 13.72%
Blackstone Group 22.88% 19.71% 8.71%

Volatility & Risk

AllianceBernstein has a beta of 1.59, indicating that its stock price is 59% more volatile than the S&P 500. Comparatively, Blackstone Group has a beta of 1.34, indicating that its stock price is 34% more volatile than the S&P 500.

Dividends

AllianceBernstein pays an annual dividend of $2.04 per share and has a dividend yield of 8.0%. Blackstone Group pays an annual dividend of $1.76 per share and has a dividend yield of 5.6%. AllianceBernstein pays out 96.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Blackstone Group pays out 76.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Blackstone Group has increased its dividend for 4 consecutive years.

Insider & Institutional Ownership

20.8% of AllianceBernstein shares are held by institutional investors. Comparatively, 46.4% of Blackstone Group shares are held by institutional investors. 2.7% of AllianceBernstein shares are held by insiders. Comparatively, 1.0% of Blackstone Group shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Blackstone Group beats AllianceBernstein on 12 of the 17 factors compared between the two stocks.

AllianceBernstein Company Profile

AllianceBernstein Holding L.P. is engaged in providing research, investment management and related services to a range of clients through its three buy-side distribution channels: Institutions, Retail and Private Wealth Management, and its sell-side business, Bernstein Research Services. The Company offers a range of investment services, including equity strategies, with global and regional portfolios across capitalization ranges and investment strategies, including value, growth and equities; traditional and unconstrained fixed income strategies, including taxable and tax-exempt strategies; passive management, including index and enhanced index strategies; alternative investments, including hedge funds, fund of funds and private equity, and multi-asset solutions and services, including dynamic asset allocation, customized target-date funds and target-risk funds. The Company’s services span various investment disciplines, including market capitalization, term and geographic locations.

Blackstone Group Company Profile

The Blackstone Group L.P. is a global alternative asset manager. The Company’s alternative asset management businesses include investment vehicles focused on private equity, non-investment grade credit, secondary private equity funds of funds and multi-asset class strategies. It operates through four segments: Private Equity, Real Estate, Hedge Fund Solutions and Credit. The Private Equity segment includes its corporate private equity business, which consists of its corporate private equity funds, Blackstone Capital Partners (BCP) funds, its sector-focused corporate private equity funds, including its energy-focused funds, Blackstone Energy Partners (BEP) funds and its core private equity fund. The Blackstone Real Estate Partners funds target a range of opportunistic real estate and real estate related investments. The Hedge Fund Solutions segment consists of Blackstone Alternative Asset Management (BAAM). The Credit segment consists principally of GSO Capital Partners LP (GSO).

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