Head-To-Head Review: Cannae (CNNE) versus iShares NASDAQ Biotechnology Index (IBB)

Cannae (NYSE: CNNE) and iShares NASDAQ Biotechnology Index (NASDAQ:IBB) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their analyst recommendations, risk, dividends, profitability, earnings, valuation and institutional ownership.

Analyst Recommendations

This is a summary of recent ratings for Cannae and iShares NASDAQ Biotechnology Index, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cannae 0 0 0 0 N/A
iShares NASDAQ Biotechnology Index 0 0 1 0 3.00

Volatility and Risk

Cannae has a beta of 0.8, indicating that its share price is 20% less volatile than the S&P 500. Comparatively, iShares NASDAQ Biotechnology Index has a beta of 1.38, indicating that its share price is 38% more volatile than the S&P 500.

Profitability

This table compares Cannae and iShares NASDAQ Biotechnology Index’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Cannae 7.05% 1.76% 0.86%
iShares NASDAQ Biotechnology Index N/A N/A N/A

Insider and Institutional Ownership

71.0% of Cannae shares are held by institutional investors. Comparatively, 24.1% of iShares NASDAQ Biotechnology Index shares are held by institutional investors. 6.0% of Cannae shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Dividends

iShares NASDAQ Biotechnology Index pays an annual dividend of $0.72 per share and has a dividend yield of 0.6%. Cannae does not pay a dividend. iShares NASDAQ Biotechnology Index pays out 2.4% of its earnings in the form of a dividend.

Earnings & Valuation

This table compares Cannae and iShares NASDAQ Biotechnology Index’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Cannae $1.34 billion 0.93 $650.00 million $1.62 10.82
iShares NASDAQ Biotechnology Index N/A N/A N/A $30.28 3.84

Cannae has higher revenue and earnings than iShares NASDAQ Biotechnology Index. iShares NASDAQ Biotechnology Index is trading at a lower price-to-earnings ratio than Cannae, indicating that it is currently the more affordable of the two stocks.

Summary

Cannae beats iShares NASDAQ Biotechnology Index on 8 of the 12 factors compared between the two stocks.

Cannae Company Profile

Cannae Holdings, Inc. is a diversified holding company. The Company has investments in a variety of industries including Restaurants, Technology Enabled Healthcare Services, Financial Services and more. The Company holds majority and minority equity investment stakes in a number of entities, including Ceridian Holdings, LLC, American Blue Ribbon Holdings, and LLC and T-System Holding LLC.

iShares NASDAQ Biotechnology Index Company Profile

iShares Nasdaq Biotechnology ETF (the Fund), formerly iShares Nasdaq Biotechnology Index Fund, is an exchange-traded fund (ETF). The Fund seeks investment results that correspond generally to the price and yield performance of the NASDAQ Biotechnology Index (the Index). The Index contains securities of NASDAQ listed companies that are classified according to the Industry Classification Benchmark as either biotechnology or pharmaceuticals, which also meet other eligibility criteria determined by NASDAQ. The Fund invests in a representative sample of securities included in the Index that collectively has an investment profile similar to the Index. Due to the use of representative sampling, the Fund may or may not hold all of the securities that are included in the Index. The Fund’s investment advisor is BlackRock Fund Advisors, which is indirectly owned by BlackRock, Inc.

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