Analyzing Virtu Financial (VIRT) and BlackRock (BLK)

Virtu Financial (NASDAQ: VIRT) and BlackRock (NYSE:BLK) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, dividends, profitability, earnings, analyst recommendations, risk and valuation.

Analyst Recommendations

How to Become a New Pot Stock Millionaire

This is a summary of current recommendations and price targets for Virtu Financial and BlackRock, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Virtu Financial 0 5 1 0 2.17
BlackRock 0 4 8 0 2.67

Virtu Financial presently has a consensus target price of $25.83, suggesting a potential downside of 28.54%. BlackRock has a consensus target price of $563.08, suggesting a potential upside of 4.58%. Given BlackRock’s stronger consensus rating and higher probable upside, analysts clearly believe BlackRock is more favorable than Virtu Financial.

Dividends

Virtu Financial pays an annual dividend of $0.96 per share and has a dividend yield of 2.7%. BlackRock pays an annual dividend of $11.52 per share and has a dividend yield of 2.1%. Virtu Financial pays out 168.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. BlackRock pays out 51.0% of its earnings in the form of a dividend. BlackRock has raised its dividend for 8 consecutive years.

Insider & Institutional Ownership

47.7% of Virtu Financial shares are owned by institutional investors. Comparatively, 84.8% of BlackRock shares are owned by institutional investors. 69.9% of Virtu Financial shares are owned by insiders. Comparatively, 1.9% of BlackRock shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Virtu Financial and BlackRock’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Virtu Financial 1.69% 10.73% 1.53%
BlackRock 39.79% 12.31% 1.67%

Earnings & Valuation

This table compares Virtu Financial and BlackRock’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Virtu Financial $1.02 billion 6.64 $2.93 million $0.57 63.42
BlackRock $12.49 billion 6.93 $4.97 billion $22.60 23.82

BlackRock has higher revenue and earnings than Virtu Financial. BlackRock is trading at a lower price-to-earnings ratio than Virtu Financial, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Virtu Financial has a beta of -0.58, indicating that its stock price is 158% less volatile than the S&P 500. Comparatively, BlackRock has a beta of 1.67, indicating that its stock price is 67% more volatile than the S&P 500.

Summary

BlackRock beats Virtu Financial on 14 of the 17 factors compared between the two stocks.

About Virtu Financial

Virtu Financial, Inc. is a holding company. The Company is a technology-enabled market maker and liquidity provider to the financial markets across the world. It is engaged in buying or selling a range of securities and other financial instruments and earning small bid/ask spreads across various transactions. It has a single, multi-asset, multi-currency technology platform, through which it provides quotations to buyers and sellers in equities, commodities, currencies, options, fixed income and other securities on exchanges, markets and liquidity pools in various countries around the world. It makes markets in a range of different assets classes, such as Americas Equities; Europe, the Middle East and Africa (EMEA) Equities; Asia Pacific (APAC) Equities; Global Commodities; Global Currencies, and Options, Fixed Income and Other Securities. It makes markets for global banks, brokers and other intermediaries, and indirectly provides services to retail and institutional investors.

About BlackRock

BlackRock, Inc. is a publicly owned investment manager. The firm primarily provides its services to institutional, intermediary, and individual investors including corporate, public, union, and industry pension plans, insurance companies, third-party mutual funds, endowments, public institutions, governments, foundations, charities, sovereign wealth funds, corporations, official institutions, and banks. It also provides global risk management and advisory services. The firm manages separate client-focused equity, fixed income, and balanced portfolios. It also launches and manages open-end and closed-end mutual funds, offshore funds, unit trusts, and alternative investment vehicles including structured funds. The firm launches equity, fixed income, balanced, and real estate mutual funds. It also launches equity, fixed income, balanced, currency, commodity, and multi-asset exchange traded funds. The firm also launches and manages hedge funds. It invests in the public equity, fixed income, real estate, currency, commodity, and alternative markets across the globe. The firm primarily invests in growth and value stocks of small-cap, mid-cap, SMID-cap, large-cap, and multi-cap companies. It also invests in dividend-paying equity securities. The firm invests in investment grade municipal securities, government securities including securities issued or guaranteed by a government or a government agency or instrumentality, corporate bonds, and asset-backed and mortgage-backed securities. It employs fundamental and quantitative analysis with a focus on bottom-up and top-down approach to make its investments. The firm employs liquidity, asset allocation, balanced, real estate, and alternative strategies to make its investments. In real estate sector, it seeks to invest in Poland and Germany. The firm benchmarks the performance of its portfolios against various S&P, Russell, Barclays, MSCI, Citigroup, and Merrill Lynch indices. BlackRock, Inc. was founded in 1988 and is based in New York City with additional offices in Boston, Massachusetts; London, United Kingdom; Gurgaon, India; Hong Kong; Greenwich, Connecticut; Princeton, New Jersey; Edinburgh, United Kingdom; Sydney, Australia; Taipei, Taiwan; Singapore; Sao Paulo, Brazil; Philadelphia, Pennsylvania; Washington, District of Columbia; Toronto, Canada; Wilmington, Delaware; and San Francisco, California.

Receive News & Ratings for Virtu Financial Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Virtu Financial and related companies with MarketBeat.com's FREE daily email newsletter.

Leave a Reply