Reviewing UBS Group (NYSE:UBS) & Donnelley Financial Solutions (NYSE:DFIN)

UBS Group (NYSE:UBS) and Donnelley Financial Solutions (NYSE:DFIN) are both finance companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, analyst recommendations, risk, valuation, earnings, dividends and profitability.

Insider & Institutional Ownership

93.8% of Donnelley Financial Solutions shares are held by institutional investors. 1.0% of UBS Group shares are held by company insiders. Comparatively, 5.2% of Donnelley Financial Solutions 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 UBS Group and Donnelley Financial Solutions’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
UBS Group	13.36%	10.77%	0.58%
Donnelley Financial Solutions	12.37%	26.70%	12.70%

Earnings and Valuation

This table compares UBS Group and Donnelley Financial Solutions”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
UBS Group	$76.12 billion	1.99	$7.77 billion	$3.03	16.04
Donnelley Financial Solutions	$787.20 million	2.09	$32.40 million	$3.79	17.85

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

Volatility and Risk

UBS Group has a beta of 1.19, meaning that its share price is 19% more volatile than the S&P 500. Comparatively, Donnelley Financial Solutions has a beta of 0.65, meaning that its share price is 35% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings for UBS Group and Donnelley Financial Solutions, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
UBS Group	2	4	6	0	2.33
Donnelley Financial Solutions	0	2	2	1	2.80

UBS Group presently has a consensus price target of $60.30, suggesting a potential upside of 24.10%. Donnelley Financial Solutions has a consensus price target of $74.00, suggesting a potential upside of 9.38%. Given UBS Group’s higher probable upside, analysts plainly believe UBS Group is more favorable than Donnelley Financial Solutions.

Summary

Donnelley Financial Solutions beats UBS Group on 9 of the 15 factors compared between the two stocks.

About UBS Group

UBS Group AG provides financial advice and solutions to private, institutional, and corporate clients worldwide. It operates through five divisions: Global Wealth Management, Personal & Corporate Banking, Asset Management, Investment Bank, and Non-core and Legacy. The company offers investment advice, estate and wealth planning, investing, corporate and banking, and investment management, as well as mortgage, securities-based, and structured lending solutions. It also provides personal banking products and services, such as deposits, credit and debit cards, and online and mobile banking, as well as lending, investments, retirement, and wealth management services; and corporate and institutional solutions, including equity and debt capital markets, syndicated and structured credit, private placements, leasing, traditional financing, and transaction banking solutions for payment and cash management services, trade and export finance, and global custody solutions. In addition, the company offers equities, fixed income, hedge funds, real estate and private markets, indexed and alternative beta strategies, asset allocation and currency investment strategies, customized multi-asset solutions, advisory and fiduciary services, and multi-manager hedge fund solutions and advisory services. Further, it advises clients on strategic business opportunities and helps them raise capital to fund their activities; enables its clients to buy, sell, and finance securities on capital markets and to manage their risks and liquidity; distributes, trades in, finances, and clears cash equities and equity-linked products; structures, originates, and distributes new equity and equity-linked issues; and originates, distributes, manages risk, and provides liquidity in foreign exchange, rates, credit and precious metals. The company was formerly known as UBS AG and changed its name to UBS Group AG in December 2014. UBS Group AG was founded in 1862 and is headquartered in Zurich, Switzerland.

About Donnelley Financial Solutions

Donnelley Financial Solutions, Inc. provides innovative software and technology-enabled financial regulatory and compliance solutions in the United States, Asia, Europe, Canada, and internationally. It operates through four segments: Capital Markets Software Solutions (CM-SS); Capital Markets Compliance and Communications Management (CM-CCM); Investment Companies Software Solutions (IC-SS); and Investment Companies Compliance and Communications Management (IC-CCM). The CM-SS segment provides Venue and ActiveDisclosure solutions to public and private companies to manage public and private transactional and compliance processes; collaborate; and tag, validate, and file SEC documents. The CM-CCM segment offers tech-enabled services and print and distribution solutions to public and private companies for deal solutions and SEC compliance requirements. The IC-SS segment provides clients with the Arc Suite platform that contains a comprehensive suite of cloud-based solutions, including ArcDigital, ArcReporting, ArcPro, and ArcRegulatory, as well as services that enable storage and management of compliance and regulatory information in a self-service and central repository for accessing, assembling, editing, translating, rendering, and submitting documents to regulators and investors. The IC-CCM segment offers tech-enabled solutions for creating, filing and distributing regulatory communications, and solutions for investor communications, as well as XBRL and iXBRL-formatted filings pursuant for Investment Company Act through the SEC’s EDGAR system. This segment also provides turnkey proxy services, including discovery, planning and implementation, print and mail management, solicitation, tabulation services, stockholder meeting review, and expert support. Donnelley Financial Solutions, Inc. was founded in 1983 and is headquartered in Chicago, Illinois.