The Bank of New York Mellon (NYSE:BK) and Westwood Holdings Group (NYSE:WHG) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, earnings, institutional ownership, profitability, valuation, dividends and risk.
Volatility and Risk
The Bank of New York Mellon has a beta of 1.07, meaning that its share price is 7% more volatile than the S&P 500. Comparatively, Westwood Holdings Group has a beta of 1.31, meaning that its share price is 31% more volatile than the S&P 500.
Profitability
This table compares The Bank of New York Mellon and Westwood Holdings Group's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| The Bank of New York Mellon | 23.09% | 9.89% | 0.89% |
| Westwood Holdings Group | 3.08% | 2.85% | 2.45% |
Insider & Institutional Ownership
82.3% of The Bank of New York Mellon shares are held by institutional investors. Comparatively, 66.3% of Westwood Holdings Group shares are held by institutional investors. 0.1% of The Bank of New York Mellon shares are held by insiders. Comparatively, 9.0% of Westwood Holdings Group shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
Dividends
The Bank of New York Mellon pays an annual dividend of $1.24 per share and has a dividend yield of 2.6%. Westwood Holdings Group pays an annual dividend of $0.40 per share and has a dividend yield of 2.3%. The Bank of New York Mellon pays out 30.8% of its earnings in the form of a dividend. The Bank of New York Mellon has increased its dividend for 1 consecutive years. The Bank of New York Mellon is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Valuation and Earnings
This table compares The Bank of New York Mellon and Westwood Holdings Group's revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| The Bank of New York Mellon | $20.77 billion | 2.05 | $4.44 billion | $4.02 | 12.09 |
| Westwood Holdings Group | $84.08 million | 1.75 | $5.91 million | N/A | N/A |
The Bank of New York Mellon has higher revenue and earnings than Westwood Holdings Group.
Analyst Ratings
This is a summary of current ratings and target prices for The Bank of New York Mellon and Westwood Holdings Group, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| The Bank of New York Mellon | 0 | 7 | 10 | 0 | 2.59 |
| Westwood Holdings Group | 0 | 0 | 0 | 0 | N/A |
The Bank of New York Mellon presently has a consensus price target of $49.40, suggesting a potential upside of 1.60%. Given The Bank of New York Mellon's higher possible upside, analysts plainly believe The Bank of New York Mellon is more favorable than Westwood Holdings Group.
Summary
The Bank of New York Mellon beats Westwood Holdings Group on 10 of the 15 factors compared between the two stocks.
