Reviewing Stifel Financial (SF) and Gamco Investors (GBL)

Stifel Financial (NYSE: GBL) and Gamco Investors (NYSE:GBL) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their analyst recommendations, valuation, dividends, institutional ownership, profitability, earnings and risk.

Risk & Volatility

Stifel Financial has a beta of 1.85, meaning that its share price is 85% more volatile than the S&P 500. Comparatively, Gamco Investors has a beta of 1.13, meaning that its share price is 13% more volatile than the S&P 500.

Dividends

Stifel Financial pays an annual dividend of $0.48 per share and has a dividend yield of 0.9%. Gamco Investors pays an annual dividend of $0.08 per share and has a dividend yield of 0.3%. Stifel Financial pays out 12.0% of its earnings in the form of a dividend. Gamco Investors has increased its dividend for 6 consecutive years.

Earnings & Valuation

This table compares Stifel Financial and Gamco Investors’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Stifel Financial $2.93 billion 1.32 $182.87 million $3.99 13.61
Gamco Investors $360.52 million 2.07 $77.80 million N/A N/A

Stifel Financial has higher revenue and earnings than Gamco Investors.

Institutional & Insider Ownership

89.8% of Stifel Financial shares are owned by institutional investors. Comparatively, 17.0% of Gamco Investors shares are owned by institutional investors. 3.9% of Stifel Financial shares are owned by insiders. Comparatively, 81.0% of Gamco Investors shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Stifel Financial and Gamco Investors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Stifel Financial 7.97% 13.91% 1.79%
Gamco Investors 24.59% -141.26% 72.93%

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Stifel Financial and Gamco Investors, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Stifel Financial 0 0 4 0 3.00
Gamco Investors 0 0 0 0 N/A

Stifel Financial currently has a consensus target price of $76.33, indicating a potential upside of 40.60%. Given Stifel Financial’s higher probable upside, research analysts clearly believe Stifel Financial is more favorable than Gamco Investors.

Summary

Stifel Financial beats Gamco Investors on 9 of the 15 factors compared between the two stocks.

About Stifel Financial

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 Gamco Investors

GAMCO Investors, Inc. is a publicly owned holding investment manager. The firm also provides wealth management, investment advisory, institutional research, brokerage, dealer, underwriting, and distribution services to its clients. It provides its services to individuals including high net worth individuals, corporate pension and profit-sharing plans, foundations, endowments, jointly trust plans, municipalities, and investment companies. The firm, through its subsidiaries, manages separate client-focused equity, fixed income, and balanced portfolios. It also launches equity, fixed income, and balanced mutual funds and manages equity mutual funds for its clients. Through its subsidiaries, the firm invests in the public equity and fixed income markets across the globe. It invests in value stocks of companies. The firm employs fundamental analysis with a focus on bottom-up stock picking approach to create its portfolios. It conducts in-house research to make its investments. The firm was founded in 1976 and is based in Rye, New York with additional offices in Greenwich, Connecticut; Bannockburn, Illinois; and Tokyo, Japan. GAMCO Investors, Inc. operates as a subsidiary of GGCP, Inc.

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