Analyzing Stifel (SF) and Cowen Group (COWN)

Stifel (NYSE: SF) and Cowen Group (NASDAQ:COWN) are both finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, earnings, analyst recommendations, risk, dividends, institutional ownership and profitability.

Dividends

Stifel pays an annual dividend of $0.48 per share and has a dividend yield of 0.8%. Cowen Group does not pay a dividend. Stifel pays out 12.0% of its earnings in the form of a dividend.

Risk & Volatility

Stifel has a beta of 1.74, suggesting that its stock price is 74% more volatile than the S&P 500. Comparatively, Cowen Group has a beta of 1.27, suggesting that its stock price is 27% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and price targets for Stifel and Cowen Group, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Stifel 0 1 4 0 2.80
Cowen Group 0 1 2 0 2.67

Stifel currently has a consensus price target of $70.00, suggesting a potential upside of 17.23%. Cowen Group has a consensus price target of $17.67, suggesting a potential upside of 13.98%. Given Stifel’s stronger consensus rating and higher probable upside, analysts plainly believe Stifel is more favorable than Cowen Group.

Earnings & Valuation

This table compares Stifel and Cowen Group’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Stifel $2.93 billion 1.46 $182.87 million $3.99 14.96
Cowen Group $658.78 million 0.69 -$60.88 million N/A N/A

Stifel has higher revenue and earnings than Cowen Group.

Insider and Institutional Ownership

87.9% of Stifel shares are held by institutional investors. Comparatively, 87.0% of Cowen Group shares are held by institutional investors. 5.1% of Stifel shares are held by company insiders. Comparatively, 4.9% of Cowen Group shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Stifel and Cowen Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Stifel 6.87% 13.14% 1.73%
Cowen Group -5.91% 4.33% 1.14%

Summary

Stifel beats Cowen Group on 14 of the 15 factors compared between the two stocks.

About Stifel

Stifel Financial Corp., a financial services and bank holding company, provides retail and institutional wealth management, and investment banking services to individual investors, corporations, municipalities, and institutions in the United States, the United Kingdom, and rest of Europe. The company operates through three segments: Global Wealth Management, Institutional Group, and Other. It provides private client services, including securities transaction and financial planning services; institutional equity and fixed income sales, trading and research, and municipal finance services; investment banking services, such as mergers and acquisitions, public offerings, and private placements; and retail and commercial banking services comprising personal and commercial lending programs, as well as deposit accounts. The company also manages and participates in underwritings for corporate and public finance. Stifel Financial Corp. was founded in 1890 and is headquartered in St. Louis, Missouri.

About Cowen Group

Cowen Inc., formerly Cowen Group, Inc., is a financial services company. The Company provides alternative investment management, investment banking, research, sales and trading, and prime brokerage services. It operates through two segments: alternative investment and broker-dealer. The alternative investment segment includes private equity structures, registered investment companies and listed investment vehicles. The broker-dealer segment offers industry focused investment banking for growth-oriented companies, including advisory and global capital markets origination and domain knowledge-driven research, and a sales and trading platform for institutional investors. Its alternative investment platform, which operates under the Ramius name, offers investment products and solutions across the liquidity spectrum to institutional and private clients. Ramius offers investors access to strategies to meet their specific needs, including long/short equity and event driven equity.

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