WhiteHorse Finance (NASDAQ:WHF) and The Bank of New York Mellon (NYSE:BK) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, risk, analyst recommendations, profitability, earnings, dividends and valuation.
Insider and Institutional Ownership
82.3% of The Bank of New York Mellon shares are held by institutional investors. 2.1% of WhiteHorse Finance shares are held by company insiders. Comparatively, 0.1% of The Bank of New York Mellon shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Valuation & Earnings
This table compares WhiteHorse Finance and The Bank of New York Mellon's gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| WhiteHorse Finance | $67.07 million | 4.53 | $30.84 million | $1.52 | 9.74 |
| The Bank of New York Mellon | $20.77 billion | 2.15 | $4.44 billion | $4.02 | 12.69 |
The Bank of New York Mellon has higher revenue and earnings than WhiteHorse Finance. WhiteHorse Finance is trading at a lower price-to-earnings ratio than The Bank of New York Mellon, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares WhiteHorse Finance and The Bank of New York Mellon's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| WhiteHorse Finance | 27.50% | 9.08% | 4.66% |
| The Bank of New York Mellon | 23.09% | 9.89% | 0.89% |
Analyst Ratings
This is a breakdown of recent ratings and price targets for WhiteHorse Finance and The Bank of New York Mellon, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| WhiteHorse Finance | 1 | 1 | 3 | 0 | 2.40 |
| The Bank of New York Mellon | 0 | 5 | 10 | 0 | 2.67 |
WhiteHorse Finance currently has a consensus target price of $13.80, indicating a potential downside of 6.76%. The Bank of New York Mellon has a consensus target price of $49.80, indicating a potential downside of 2.41%. Given The Bank of New York Mellon's stronger consensus rating and higher possible upside, analysts clearly believe The Bank of New York Mellon is more favorable than WhiteHorse Finance.
Risk and Volatility
WhiteHorse Finance has a beta of 1.38, meaning that its stock price is 38% more volatile than the S&P 500. Comparatively, The Bank of New York Mellon has a beta of 1.07, meaning that its stock price is 7% more volatile than the S&P 500.
Dividends
WhiteHorse Finance pays an annual dividend of $1.42 per share and has a dividend yield of 9.6%. The Bank of New York Mellon pays an annual dividend of $1.24 per share and has a dividend yield of 2.4%. WhiteHorse Finance pays out 93.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. The Bank of New York Mellon pays out 30.8% of its earnings in the form of a dividend. WhiteHorse Finance has raised its dividend for 1 consecutive years and The Bank of New York Mellon has raised its dividend for 1 consecutive years.
Summary
The Bank of New York Mellon beats WhiteHorse Finance on 9 of the 16 factors compared between the two stocks.
