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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Affiliated Managers Group, Inc. (XNYS:AMG) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
AMG
Name:
AFFILIATED MANAGERS GROUP, INC. (XNYS:AMG)
Sector:
- 3700.00K
Industry:
Asset Management
CEO:
Mr. Jay Horgen
Total Employees:
4,050
Our Technological Advancement Rating
Our Rating:
A+
Technological advancement compared to industry is 467.55% higher
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF AFFILIATED MANAGERS GROUP, INC.(AMG) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND ASSET MANAGEMENT INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
125.28
One Month Price Target:
$126.18
Six Month Price Target :
$130.67
Likely Price in One Year's Time:
Ticker:
$136.05
Likely Trading Range Today Under (Normal Volatility)
$124.78
Price Upper limit ($) :
$126.04
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$117.79
This week:
$108.53
This month :
$91.78
Other Primary facts
Market Cap:
4.78B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
38.23M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
17.52%
-18.08%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$160.02
$143.94
$90.54
$106.62
Medium risk (<10%) entry points
Buy Call
Sell Call
$138.70
Buy Put:
Sell Put:
$135.27
$111.81
$115.29
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
AMG
Sharpe Ratio:
3.15%
Comparison:
AMG, is amongst the top 20% stocks with highest risk-adjusted returns
Sharpe ratio is 292.32% higher than the industry
& ratio is 38.40% higher than the market/S&P 500 average
Average Returns/Yield of
AMG
Daily returns:
0.10%
Weekly returns:
0.51%
Monthly returns:
2.05%
Yearly returns:
9.18%
Comparison of returns:
Average annual returns/yield (last 3 years) is 167.28% above industry average
Classification:
AMG, is amongst the top 20% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.86
Statistical test of Returns:
AMG has not yielded statistically significant higher returns when compared to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.96%
Weekly Volatility:
6.62%
Monthly Volatility:
13.24%
Yearly Volatility:
45.88%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.44%
Volatility in last five trading days has been -85.30% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-5.98%
Weekly VaR:
-13.37%
Monthly VaR:
-26.74%
How Much Can the price of
AMG
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-22%
Worst case (decline):
-92.64%
This translates to price declining to:
$97.12
This translates to price declining to:
$9.22
Severe Crash Probability
Risk of crash in next 6/12 months: High (50-70%)
What is Value at Risk (VaR)?
Risk Fundamentals
AMG is a 88.75% riskier investment compared to the market/S&P 500 & is 61.70% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 13.96% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
AMG
Beta in relation to market/S&P 500--1.28
Expected beta in 1 year's time:
1.018
Expected beta in 3 year's time:
1.439
Unlevered (debt free) Beta:
0.731
Beta in relation to Nasdaq (XNAS):
1.035
Beta in relation to all global stocks::
0.942
Beta Comparison & Analysis
Beta of competitors/peers::
1.32
Beta is -3.10% lower than peers
Average Industry Beta:
1.694
Beta is -24.49% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
18.82%
Sustainable growth rate is -33.25% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.126
Alpha is -326.66% below industry average alpha yield
Alpha is 804% higher than market/& is unsustainably high
Analysis of Cost of Capital of
AMG
Equity cost of capital:
0.119
Equity cost of capital is -19.26% below industry mean WACC
Unlevered (without debt) cost of capital:
6.80%
Before-tax cost of debt:
4.38%
After-tax cost of debt:
3.46%
Overall debt rating:
Lower BB medium grade (Fifth highest grade)
Weighted average cost of capital (WACC):
3.46%
WACC is 27.17% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$64.37
Revenue growth rate per share of (3Y):
1.13
Annual revenue growth rate is -85.18% below industry average
EPS:
$12.44
Expected Annual growth rate of EPS (3Y):
244.10%
Expected future EPS growth rate is 778.88% higher than the Asset Management industry
Free cash flow (FCF) per share:
$26.40
Balance sheet equity growth per share: -96.96%
Equity growth rate per share is -558.80% lower than the industry
Debt per share
$67.44
EBITDA per share
$25.83
Valuation Analysis Today of
AMG
P/E Ratio:
10.06
P/E Ratio of Competitors/Peers:
7.09
P/E ratio is 41.99% higher than main peers & is -37.69% lower than the industry
Stock price/value with industry average P/E ratio: $200.88
AMG is -37.63% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $10.11
Present value of the expected future dividends only: $0.17
P/S (Price to Sales ratio):
1.95
Price to sales ratio is -71.59% below the industry mean
P/B (Price to book value ratio):
1.13
Price to free cash flow: 4.75
-
Net income growth rate (3Y):
167.68%
Net income growth rate is 15.34% higher than the average industry net income growth rate
Dividend Analysis
Dividend payout rate: 0.07%
Dividend yeild: 0.03%
Previous Dividend: $0.01
Previous adjusted dividend: $0.01
Previous Dividend: $0.04
Expected next dividend best case: $0.11
Expected next dividend worst case: -$0.09
Average dividend payment (long-term): $0.07
Average dividend increase/decrease (growth rate) % per period: -9.69%
Expected next dividend payment date: 24/08/2022
Expected next dividend record date: 08/10/2022
Expected next dividend declaration date: 08/01/2022
Previous dividend payment date: 26/05/2022
Previous dividend record date: 05/12/2022
Previous dividend declaration date: 05/02/2022
Dividend History:
2022-05-11--$0.01
2021-11-09--$0.01
2021-05-12--$0.01
2022-02-16--$0.01
2021-08-05--$0.01
2021-02-17--$0.01
Dividend growth rate is -275.50% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
96.59%
Net debt to equity ratio:
77.82%
Debt to assets ratio:
30.08%
Net debt to assets ratio:
24.23%
Debt-to-asset ratio is -42.45% below industry average
Ability to repay debt:
Interest coverage ratio:
8.74
Interest coverage ratio is -85.31% less than industry average
Looking forward:
Debt growth rate:
-46.14%
Annual debt growth is 567% higher than industry average debt growth rate
Debt repayment rate in last quarter: 0.64%
Analysis of Key Statistics
Correlation of price movement with the market:
0.736
Statistical significance of correlation:
AMG has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.576
Stock price is 27.74% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.576
Correlation of price movement with Nasdaq (^IXIC):
0.018
Covariance of price movement with the market:
0.031
Kurtosis
5.919
Returns have moderate fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
0.231
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
AMG
Gross Profit Margin Ratio:
228%
Operating Profit Margin Ratio:
39.77%
Operating profit margin is -15.44% lower than the industry
Net Profit Margin Ratio:
228%
Effective Tax Rate:
22.25%
Effective tax rate is -8.87% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
21.05%
Return on equity (ROE) is -16.73% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
6.55%
Return on assets (ROA) is 12.33% higher than the industry
Financial Leverage:
1.4x
Current Ratio:
1.9
Current ratio is -50.48% below industry average
Cash Conversion Cycle (days):
63.4
Cash conversion cycle is -92.70% below industry average
The remaining useful life of property plant & equipment is: 6.2 years
Stock based compensation to net income ratio:
5.50%
In-depth Efficiency Analysis
Revenue generated per employee:
607.6K
Each employee generates -56% less revenue than industry average revenue per employee
EBITDA generated per employee:
243.8K
Each employee generates -132% less EBITDA than industry average revenue per employee
Profit generated per employee:
138.7K
Each employee generates -111% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 0.9K
Each employee generates -99% less free cash flow than industry average revenue per employee
Assets/Capital per employee
1.9M
Each employee generates -99% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
AMG
FIRST AMERICAN FINANCIAL CORPORATION (XNYS:FAF)
SYNOVUS FINANCIAL CORP. (XNYS:SNV)
Bancolombia SA (XNYS:CIB)
SF
PROSPERITY BANCSHARES, INC. (XNYS:PB)
OneMain Holdings, Inc. (XNYS:OMF)
Banco Santander Mexico SA Institucion de Banca Multiple Grupo Financiero Santander Mexico (XNYS:BSMX)
CHARGEPOINT HOLDINGS, INC. (XNYS:CHPT)
CULLEN/FROST BANKERS, INC. (XNYS:CFR)
Current Analyst Ratings
Strong buy�17%
Buy�13%
Hold�8%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Strong buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
2.46B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
1.06B
1.41B
-
-
357.70M
-
69.00M
426.70M
-
113.00M
56.50M
987.40M
978.70M
561.80M
1.15B
256.10M
561.80M
Statement of Cash Flow
Date:
Period:
12.60M
Differed Income Tax :
20.20M
Stock Based Compensation :
30.90M
Change in Working Capital :
- 282400.00K
Accounts Receivables:
-
Other Working Capital:
-
Other Non-Cash Items:
-
Net Cash Provided by Operating Activities:
-
Investments in PP&E:
- 3700.00K
Net Acquisitions:
-
Purchases of Investments:
- 27200.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
501.00M
81.10M
582.10M
465.80M
-
-
1.05B
73.90M
2.68B
1.94B
2.59B
485.70M
- 253000.00K
7.52B
1.69B
8.57B
-
-
-
-
551.60M
551.60M
2.58B
723.60M
3.79B
-
4.34B
600.00K
4.72B
- 93200.0K
- 1958000.00K
March 31, 2022 at 6:00:00 AM
1.48B
2.67B
7.01B
2.67B
2.58B
2.1B
9.50M
- 136000.00K
- 157400.00K
- 16500.00K
-
- 201300.00K
- 400.00K
- 170700.00K
- 388900.00K
- 6200.00K
- 407500.00K
501.00M
908.50M
-
- 3700.00K
- 3700.00K
Our Proprietary Portfolio Rating
Our Rating:
A+
Price Forecast/Expected Price in Next 5 Years of
AMG
2023
2024
2025
2026
2027
$136.73
$291.61
$316.68
$343.91
$373.48