Raymond James (NYSE:RJF) and The Goldman Sachs Group (NYSE:GS) are both large-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, risk, dividends, valuation, analyst recommendations, profitability and earnings.
Analyst Recommendations
This is a summary of recent recommendations and price targets for Raymond James and The Goldman Sachs Group, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
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Raymond James | 0 | 2 | 9 | 0 | 2.82 |
The Goldman Sachs Group | 1 | 5 | 16 | 0 | 2.68 |
Raymond James currently has a consensus target price of $116.50, suggesting a potential downside of 3.26%. The Goldman Sachs Group has a consensus target price of $305.7619, suggesting a potential downside of 6.71%. Given Raymond James' stronger consensus rating and higher possible upside, equities analysts clearly believe Raymond James is more favorable than The Goldman Sachs Group.
Valuation & Earnings
This table compares Raymond James and The Goldman Sachs Group's revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
---|
Raymond James | $8.17 billion | 2.03 | $818 million | $6.11 | 19.71 |
The Goldman Sachs Group | $53.92 billion | 2.10 | $8.47 billion | $21.03 | 15.59 |
The Goldman Sachs Group has higher revenue and earnings than Raymond James. The Goldman Sachs Group is trading at a lower price-to-earnings ratio than Raymond James, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
75.1% of Raymond James shares are held by institutional investors. Comparatively, 68.1% of The Goldman Sachs Group shares are held by institutional investors. 10.8% of Raymond James shares are held by insiders. Comparatively, 0.6% of The Goldman Sachs Group shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Profitability
This table compares Raymond James and The Goldman Sachs Group's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
---|
Raymond James | 10.02% | 12.29% | 1.88% |
The Goldman Sachs Group | 16.65% | 11.23% | 0.83% |
Volatility & Risk
Raymond James has a beta of 1.35, indicating that its stock price is 35% more volatile than the S&P 500. Comparatively, The Goldman Sachs Group has a beta of 1.5, indicating that its stock price is 50% more volatile than the S&P 500.
Dividends
Raymond James pays an annual dividend of $1.56 per share and has a dividend yield of 1.3%. The Goldman Sachs Group pays an annual dividend of $5.00 per share and has a dividend yield of 1.5%. Raymond James pays out 25.5% of its earnings in the form of a dividend. The Goldman Sachs Group pays out 23.8% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Raymond James has raised its dividend for 1 consecutive years and The Goldman Sachs Group has raised its dividend for 1 consecutive years. The Goldman Sachs Group is clearly the better dividend stock, given its higher yield and lower payout ratio.
Summary
The Goldman Sachs Group beats Raymond James on 9 of the 16 factors compared between the two stocks.