Head-To-Head Comparison: GCM Grosvenor (NASDAQ:GCMG) vs. Charles Schwab (NYSE:SCHW)

Charles Schwab (NYSE:SCHW) and GCM Grosvenor (NASDAQ:GCMG) are both finance companies, but which is the better stock? We will contrast the two companies based on the strength of their profitability, institutional ownership, dividends, risk, earnings, analyst recommendations and valuation.

Dividends

Charles Schwab pays an annual dividend of $1.28 per share and has a dividend yield of 1.4%. GCM Grosvenor pays an annual dividend of $0.48 per share and has a dividend yield of 3.9%. Charles Schwab pays out 21.8% of its earnings in the form of a dividend. GCM Grosvenor pays out 92.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Charles Schwab has increased its dividend for 1 consecutive years.

Earnings and Valuation

This table compares Charles Schwab and GCM Grosvenor”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Charles Schwab	$23.92 billion	6.55	$8.85 billion	$5.86	15.45
GCM Grosvenor	$557.57 million	4.50	$45.37 million	$0.52	23.79

Charles Schwab has higher revenue and earnings than GCM Grosvenor. Charles Schwab is trading at a lower price-to-earnings ratio than GCM Grosvenor, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Charles Schwab has a beta of 0.79, suggesting that its share price is 21% less volatile than the S&P 500. Comparatively, GCM Grosvenor has a beta of 0.87, suggesting that its share price is 13% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings for Charles Schwab and GCM Grosvenor, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Charles Schwab	1	5	18	0	2.71
GCM Grosvenor	0	1	4	0	2.80

Charles Schwab currently has a consensus price target of $120.18, indicating a potential upside of 32.71%. GCM Grosvenor has a consensus price target of $14.62, indicating a potential upside of 18.23%. Given Charles Schwab’s higher probable upside, analysts clearly believe Charles Schwab is more favorable than GCM Grosvenor.

Institutional and Insider Ownership

84.4% of Charles Schwab shares are owned by institutional investors. Comparatively, 100.0% of GCM Grosvenor shares are owned by institutional investors. 6.3% of Charles Schwab shares are owned by company insiders. Comparatively, 70.7% of GCM Grosvenor shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Charles Schwab and GCM Grosvenor’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Charles Schwab	39.33%	25.79%	2.22%
GCM Grosvenor	7.79%	142.74%	18.73%

Summary

Charles Schwab beats GCM Grosvenor on 9 of the 17 factors compared between the two stocks.

About Charles Schwab

The Charles Schwab Corporation, together with its subsidiaries, operates as a savings and loan holding company that provides wealth management, securities brokerage, banking, asset management, custody, and financial advisory services in the United States and internationally. The company operates in two segments, Investor Services and Advisor Services. It offers brokerage accounts with equity and fixed income trading, margin lending, options trading, futures and forex trading, and cash management capabilities, including certificates of deposit; third-party mutual funds through the Mutual Fund Marketplace and Mutual Fund OneSource service, as well as mutual fund trading and clearing services to broker-dealers; exchange-traded funds; advisory solutions for managed portfolios, separately managed accounts, customized personal advice for tailored portfolios, specialized planning, and full-time portfolio management; banking products comprising checking and savings accounts, first lien residential real estate mortgage loans, home equity lines of credit, and pledged asset lines; and trust custody services, personal trust reporting services, and administrative trustee services. It also provides digital retirement calculators; integrated web-, mobile-, and software-based trading platforms, real-time market data, options trading, premium research, and multi-channel access; self-service education and support tools; online research and analysis tools; equity compensation plan sponsors full-service recordkeeping for stock plans, stock options, restricted stock, performance shares, and stock appreciation rights; retirement plan services; mutual fund clearing services; and advisor services, including interactive tools and educational content. The Company operates through branch offices. The Charles Schwab Corporation was incorporated in 1971 and is headquartered in Westlake, Texas.

About GCM Grosvenor

GCM Grosvenor Inc. is global alternative asset management solutions provider. The firm primarily provides its services to pooled investment vehicles. It also provides its services to investment companies, high net worth individuals, pension and profit sharing plans and state or municipal government entities. The firm invests in equity and alternative investment markets of the United States and internationally. The firm invests in multi-strategy, credit-focused, equity-focused, macro-focused, commodity-focused, and other specialty portfolios. It focuses in hedge fund asset classes, private equity, real estate, and/or infrastructure, credit and absolute return strategies. It also focuses in primary fund investments, secondary fund investments, and co-investments with a focus on buyout, distressed debt, mezzanine, venture capital/growth equity investments. The firm seeks to do seed investments in small, emerging, and diverse private equity firms. The firm seeks to make regionally-focused investments in middle-market buyout. It prefers to invest in aerospace and defense, advanced electronics, information technology, biosciences, and advanced materials. It focuses on Ohio and the Midwest region. The firm employs fundamental and quantitative analysis. GCM Grosvenor Inc. was founded in 1971 and is based in Chicago, Illinois with additional offices in North America, Asia, Australia and Europe.