BlackRock (NYSE: BLK) and Diamond Hill Investment Group (NASDAQ:DHIL) are both financials companies, but which is the superior investment? We will compare the two companies based on the strength of their earnings, risk, valuation, dividends, profitability, analyst recommendations and institutional ownership.
Institutional and Insider Ownership
82.4% of BlackRock shares are held by institutional investors. Comparatively, 62.3% of Diamond Hill Investment Group shares are held by institutional investors. 1.9% of BlackRock shares are held by company insiders. Comparatively, 7.3% of Diamond Hill Investment Group shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
BlackRock pays an annual dividend of $10.00 per share and has a dividend yield of 1.8%. Diamond Hill Investment Group does not pay a dividend. BlackRock pays out 43.5% of its earnings in the form of a dividend. BlackRock has increased its dividend for 8 consecutive years.
This is a breakdown of current ratings and price targets for BlackRock and Diamond Hill Investment Group, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Diamond Hill Investment Group||0||0||0||0||N/A|
BlackRock presently has a consensus price target of $542.42, indicating a potential downside of 1.33%. Given BlackRock’s higher possible upside, research analysts plainly believe BlackRock is more favorable than Diamond Hill Investment Group.
Risk & Volatility
BlackRock has a beta of 1.75, suggesting that its share price is 75% more volatile than the S&P 500. Comparatively, Diamond Hill Investment Group has a beta of 0.89, suggesting that its share price is 11% less volatile than the S&P 500.
Valuation and Earnings
This table compares BlackRock and Diamond Hill Investment Group’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|BlackRock||$12.49 billion||7.09||$4.97 billion||$22.97||23.93|
|Diamond Hill Investment Group||$145.20 million||5.00||$46.05 million||$14.47||14.37|
BlackRock has higher revenue and earnings than Diamond Hill Investment Group. Diamond Hill Investment Group is trading at a lower price-to-earnings ratio than BlackRock, indicating that it is currently the more affordable of the two stocks.
This table compares BlackRock and Diamond Hill Investment Group’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Diamond Hill Investment Group||34.43%||29.26%||21.55%|
BlackRock beats Diamond Hill Investment Group on 12 of the 16 factors compared between the two stocks.
BlackRock Company Profile
BlackRock, Inc. (BlackRock) is an investment management company. BlackRock provides a range of investment and risk management services to institutional and retail clients worldwide. Its diverse platform of active (alpha) and index (beta) investment strategies across asset classes enables the Company to tailor investment outcomes and asset allocation solutions for clients. Its product offerings include single- and multi-asset portfolios investing in equities, fixed income, alternatives and money market instruments. Its products are offered directly and through intermediaries in a range of vehicles, including open-end and closed-end mutual funds, iShares exchange-traded funds (ETFs), separate accounts, collective investment funds and other pooled investment vehicles. It offers its Aladdin investment system, as well as risk management, outsourcing, advisory and technology services, to institutional investors and wealth management intermediaries under the BlackRock Solutions name.
Diamond Hill Investment Group Company Profile
Diamond Hill Investment Group, Inc. provides investment advisory and fund administration services. The Company’s subsidiaries include Diamond Hill Capital Management, Inc. (DHCM), Beacon Hill Fund Services, Inc. (BHFS) and BHIL Distributors, Inc. (BHIL). The Company’s primary objective is to fulfill its fiduciary duty to clients. The Company provides investment management and administration services to mutual funds, institutional accounts and private investment funds. DHCM is an investment advisor to the Diamond Hill Funds (the Funds), a series of open-end mutual funds, private investment funds (Private Funds), an exchange traded fund and other institutional accounts. In addition, DHCM is administrator for the Funds. BHFS provides compliance, treasury and other fund administration services to investment advisors and mutual funds. BHIL is a subsidiary of BHFS. BHIL provides underwriting services to mutual funds. BHFS and BHIL collectively operate as Beacon Hill.
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