Contrasting B. Riley Financial (NASDAQ:RILY) and Moelis & Company (NYSE:MC)

Moelis & Company (NYSE:MC) and B. Riley Financial (NASDAQ:RILY) are both finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their valuation, institutional ownership, earnings, risk, profitability, analyst recommendations and dividends.

Analyst Recommendations

This is a summary of recent ratings and price targets for Moelis & Company and B. Riley Financial, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Moelis & Company	0	6	2	0	2.25
B. Riley Financial	1	0	0	0	1.00

Moelis & Company currently has a consensus price target of $68.17, indicating a potential upside of 20.65%. Given Moelis & Company’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Moelis & Company is more favorable than B. Riley Financial.

Volatility and Risk

Moelis & Company has a beta of 1.87, indicating that its share price is 87% more volatile than the S&P 500. Comparatively, B. Riley Financial has a beta of 1.2, indicating that its share price is 20% more volatile than the S&P 500.

Profitability

This table compares Moelis & Company and B. Riley Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Moelis & Company	14.22%	39.62%	17.34%
B. Riley Financial	8.83%	190.02%	4.62%

Institutional and Insider Ownership

91.5% of Moelis & Company shares are held by institutional investors. Comparatively, 50.2% of B. Riley Financial shares are held by institutional investors. 6.3% of Moelis & Company shares are held by insiders. Comparatively, 27.8% of B. Riley Financial shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Moelis & Company and B. Riley Financial”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Moelis & Company	$1.64 billion	2.69	$233.04 million	$2.94	19.22
B. Riley Financial	$967.60 million	0.16	$307.42 million	$3.75	1.04

B. Riley Financial has lower revenue, but higher earnings than Moelis & Company. B. Riley Financial is trading at a lower price-to-earnings ratio than Moelis & Company, indicating that it is currently the more affordable of the two stocks.

Summary

Moelis & Company beats B. Riley Financial on 10 of the 14 factors compared between the two stocks.

About Moelis & Company

Moelis & Company is an independent investment bank that provides strategic and financial advice to corporations, governments, financial sponsors and investors. Its advisory work includes mergers and acquisitions, restructurings, recapitalizations, liability management and other complex financial matters. Founded in 2007 by investment banker Kenneth Moelis, the firm has expanded from its U.S. base to serve clients through offices across the Americas, Europe, the Middle East and Asia. Its teams advise clients on transactions and strategic decisions across a range of industries.

About B. Riley Financial

B. Riley Financial, Inc. is a diversified financial services company headquartered in Los Angeles. Founded in 1997, it has built a portfolio of businesses serving companies, institutional investors and individuals. The company’s services have included investment banking, capital markets, research, sales and trading, and wealth management. Through its business advisory operations, it has also provided restructuring, valuation, appraisal, auction and liquidation services. B. Riley has served clients across the United States and, through its various businesses, in international markets.