Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 4 stocks made the list for top value stocks in the Investment Management & Fund Operators industry. Those looking for value stocks to add to their portfolio may want to use this list as a starting point for further investment research.

Why Focus on Undervalued Investment Management & Fund Operators Stocks?

Value investors seek to buy stocks at a discount to their intrinsic value. Long-term returns show that such strategies are advantageous. Value stocks, as a group, tend to outperform growth stocks over extended periods of time. Typically, value investors perform financial analysis of numerous metrics, don’t follow the herd and are long-term investors.

AAII’s A+ Investor Value Grade is derived from a stock’s Value Score. The Value Score is the percentile rank of the average of the percentile ranks of the price-to-sales ratio, price-earnings ratio, enterprise-value-to-EBITDA (EV/EBITDA) ratio, shareholder yield, price-to-book-value ratio and price-to-free-cash-flow ratio. The score is variable, meaning it can consider all six ratios or, should any of the six ratios not be valid, the remaining ratios that are valid. To be assigned a Value Score, stocks must have a valid (non-null) ratio and corresponding ranking for at least two of the six valuation ratios.

What Goes Into AAII’s Value Grade?

Stock evaluation requires access to huge amounts of data as well as the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movement. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors with that task.

AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A–F grades for more than just value. It is possible for a stock to appear cheap based on one valuation metric but appear expensive on another. It is also possible for one valuation ratio to be associated with outperforming stocks during certain periods of time but not others. Some stocks may even have null values for certain metrics like the price-earnings ratio or the price-to-book ratio but not others. An example of this would be a company with losses instead of profits or a negative book value because of heavy borrowing. Negative earnings or book value result in non-meaningful ratios that are left blank or null.

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4 Undervalued Investment Management & Fund Operators Stocks

Of course, there are countless value stocks that are worth mentioning, but this is a concise list of the top 4 undervalued stocks in the Investment Management & Fund Operators industry for Thursday, September 12, 2024. Let’s take a closer look at their individual scores to see how they measure up against each other and the Investment Management & Fund Operators industry median.

The Value Grade is assigned based on how each stock’s composite valuation compares to all other stocks.

The process for assigning grades starts with each variable for a given stock. The percentile rankings for all valid ratios that a stock has are calculated. So, for instance, a stock could have a price-to-book ranking in the 43rd percentile, a price-earnings ranking in the 67th percentile, a price-to-sales ranking in the 23rd percentile, etc. Then, those rankings are averaged for each stock. (A minimum of two valid variables are required, though all six will be used if available.)

Once the average of the individual variables is calculated, that average is ranked against all stocks. Put another way, each stock’s composite valuation is compared to all other stocks. These ranks are then sorted into quintiles from the cheapest 20% (a grade of A) to the most expensive 20% (a grade of F).

As always, we recommend that you conduct proper due diligence and research before investing in any security. We also suggest that investors utilize numerous grades, not just value, when it comes to deciding whether a company is a good fit for their allocation needs.

Affiliated Managers Group, Inc.’s Value Grade

Value Grade:

Affiliated Managers Group, Inc. is a global independent investment management company. The Company is focused on investing in a range of partner-owned investment firms, known as Affiliates. Its Affiliates provide a diverse range of differentiated investment strategies designed to assist institutional and wealth clients worldwide in achieving their investment objectives. Its Affiliates also provide investment management and customized investment counseling and fiduciary services to high-net worth individuals and families and institutional clients. Its Affiliates distribute their investment services and products to institutional and wealth clients through direct sales and relationships with consultants and intermediaries around the world through their own business development capabilities. Its Affiliates manage assets for investors in more than 50 countries. It manages its assets across a range of private markets, liquid alternative and differentiated long-only investment strategies.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Affiliated Managers Group, Inc. has a Value Score of 74, which is considered to be undervalued.

When you look at Affiliated Managers Group, Inc.’s price-to-sales ratio at 2.56 compared to the industry median at 3.58, this company has a lower price relative to revenue compared to its peers. This could make Affiliated Managers Group, Inc.’s stock more attractive for value investors.

Affiliated Managers Group, Inc.’s price-earnings ratio is 10.46 compared to the industry median at 14.30. This means it has a lower share price relative to earnings compared to its peers. This could make Affiliated Managers Group, Inc. more attractive for value investors.

Now, let’s assess Affiliated Managers Group, Inc.’s EV/EBITDA ratio, also known as enterprise multiple. At 11.0, when compared to the industry median of 16.3, the company may be considered undervalued in relation to its peers. Value investors could use the enterprise multiple to identify stocks that are considered overvalued or undervalued relative to their industry.

Shareholder yield is the sum of a stock’s dividend yield (paid over previous 12 months minus special dividends) and the percentage of net share buybacks over the previous 12 months. Affiliated Managers Group, Inc.’s shareholder yield is higher than its industry median ratio of 2.35%. Value investors may look for an attractive shareholder yield because it can be a powerful tool for identifying if the company has a good management team.

As one of the most common value metrics, the price-to-book ratio evaluates a company’s current market price relative to its book value. Affiliated Managers Group, Inc.’s price-to-book ratio is higher than its industry median ratio of 1.07. This could make Affiliated Managers Group, Inc. less attractive to investors looking for a new addition to their portfolio.

Lastly, let’s take a look at Affiliated Managers Group, Inc.’s price-to-free-cash-flow ratio (P/FCF), which can indicate a company’s market value relative to its operating cash flow. Affiliated Managers Group, Inc.’s price-to-free-cash-flow ratio is lower than its industry median ratio of 16.01. This could make Affiliated Managers Group, Inc. more attractive because the lower P/FCF ratio indicates that Affiliated Managers Group, Inc. is undervalued. The P/FCF ratio metric can also be viewed over a long-term time frame to see if the company's cash flow to share price value is generally improving or worsening.

Brookfield Wealth Solutions Ltd’s Value Grade

Value Grade:

Brookfield Wealth Solutions Ltd, formerly Brookfield Reinsurance Ltd, is a Bermuda-based wealth solutions company. The Company is focused on securing the financial futures of individuals and institutions through a range of wealth protection and retirement services, and tailored capital solutions. The Company, through its operating subsidiaries, offers a range of insurance products and services, including annuities, personal and commercial property and casualty insurance and life insurance.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Brookfield Wealth Solutions Ltd has a Value Score of 79, which is considered to be undervalued.

Brookfield Wealth Solutions Ltd’s price-earnings ratio is 3.7 compared to the industry median at 14.3. This means that it has a lower price relative to its earnings compared to its peers. This makes Brookfield Wealth Solutions Ltd more attractive for value investors.

Brookfield Wealth Solutions Ltd’s price-to-book ratio is higher than its peers. This could make Brookfield Wealth Solutions Ltd less attractive for value investors when compared to the industry median at 1.07.

You can read more about Brookfield Wealth Solutions Ltd’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Carbon Streaming Corp’s Value Grade

Value Grade:

Carbon Streaming Corporation is a carbon credit streaming and royalty company. The Company is a supplier of credits to corporate buyers and a funding partner of choice to carbon project developers around the world. It is focused on acquisition and sale of carbon credits. Its projects include Azuero Reforestation, Feather River Reforestation, Rimba Raya, Cerrado Biome, Community Carbon, Sustainable Community, Sheep Creek Reforestation, Magdalena Bay Blue Carbon, Nalgonda Rice Farming, Waverly Biochar, Enfield Biochar and Bonobo Peace Forest. Rimba Raya is located on the island of Borneo in Indonesia, protects, and preserves tropical lowland peat swamp forests, which have carbon-storing capacity. Cerrado Biome project is located in the Cerrado biome. Community Carbon provides solutions to various households in eastern and southern Africa through five projects, delivering cookstoves in Mozambique, Uganda and Tanzania and distributing water purification devices in Malawi and Uganda.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Carbon Streaming Corp has a Value Score of 64, which is considered to be undervalued.

Carbon Streaming Corp’s price-to-book ratio is higher than its peers. This could make Carbon Streaming Corp less attractive for value investors when compared to the industry median at 1.07.

You can read more about Carbon Streaming Corp’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Virtus Investment Partners Inc’s Value Grade

Value Grade:

Virtus Investment Partners, Inc. provides investment management and related services to individuals and institutions. The Company offers investments strategies for individual and institutional investors in different investment product structures and through multiple distribution channels. The Company provides various asset classes (equity, fixed income, multi-asset and alternative), geographies (domestic, global, international, and emerging), market capitalizations (large, mid, and small), styles (growth, core, and value) and investment approaches (fundamental and quantitative). Its retail products include open-end funds and exchange traded funds (ETFs), as well as closed-end funds and retail separate accounts. Its institutional products are offered through separate accounts and pooled to a variety of institutional clients. The Company also provides sub advisory services to other investment advisers and serve as the collateral manager for structured products.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Virtus Investment Partners Inc has a Value Score of 61, which is considered to be undervalued.

Virtus Investment Partners Inc’s price-earnings ratio is 13.1 compared to the industry median at 14.3. This means that it has a lower price relative to its earnings compared to its peers. This makes Virtus Investment Partners Inc more attractive for value investors.

Virtus Investment Partners Inc’s price-to-book ratio is lower than its peers. This could make Virtus Investment Partners Inc more attractive for value investors when compared to the industry median at 1.07.

You can read more about Virtus Investment Partners Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Other Investment Management & Fund Operators Stock Grades

Value is just one of the five Stock Grades included in our A+ Investor service. AAII members can see the top-graded stocks—those with grades of A or B for value, growth, momentum, earnings estimate revisions and quality—on the A+ Stock Grades Screener.

Also, if you want full access to all of AAII’s premium services, you can subscribe to one convenient bundled plan called AAII Platinum where you can try out A+ Investor, AAII Dividend Investing, the Stock Superstars Report, Growth Investing and VMQ Stocks. With the other premium services, you can dive deep into additional metrics, portfolios, commentary and information about Investment Management & Fund Operators stocks as well as other industrys.

Choosing Which of the 4 Best Investment Management & Fund Operators Stocks Is Right for You

Choosing which value stocks to invest in will ultimately depend on your individual goals and allocation; however, comparing similar value stocks in the same industry can help you analyze which might be better investments for you in the long run. So, let’s take a look at the Value Grade for all of our stocks.

• Affiliated Managers Group, Inc. stock has a Value Grade of B.
• Brookfield Wealth Solutions Ltd stock has a Value Grade of B.
• Carbon Streaming Corp stock has a Value Grade of B.
• Virtus Investment Partners Inc stock has a Value Grade of B.

Now that you have a bit more background about each of the 4 undervalued stocks in the Investment Management & Fund Operators industry as well as their overall grades, it’s time for you to conduct additional research to see if these could fit your portfolio needs based on your goals and risk tolerance. AAII can help you figure out both and identify which investments align with what works best for you.

We do so through a program of education that teaches you to invest for yourself and become an effective manager of your own wealth—no more relying on others for your financial independence. You can rely on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis that makes you a better investor.

A+ Investor adds to that qualitative teaching by giving you a powerful data suite that helps you whittle down investment decisions to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.

Additional Resources About Investment Management & Fund Operators Stocks

Want to learn more about Investment Management & Fund Operators stocks to see if they could be the right investment for you? Check out some additional resources and articles to help you on your financial journey.

• 4 Undervalued Investment Management & Fund Operators Stocks for Thursday, September 12
• 7 Undervalued Investment Management & Fund Operators Stocks for Wednesday, September 11
• Why Noah Holdings Limited (ADR)’s (NOAH) Stock Is Up 4.03%
• 3 Undervalued Investment Management & Fund Operators Stocks for Tuesday, September 10

AAII Disclaimer

We make no representations or warranties that any investor will, or is likely to, achieve profits similar to those shown, because past, hypothetical or simulated performance is not necessarily indicative of future results. Before making an investment decision, you should consider your circumstances and whether the information on our content is applicable to your situation. This information was prepared in good faith and we accept no liability for any errors or omissions. The full disclaimer can be read here.