GAM (OTCMKTS:GMHLY) & Westwood Holdings Group (NYSE:WHG) Critical Comparison

Westwood Holdings Group (NYSE:WHG) and GAM (OTCMKTS:GMHLY) are both finance companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, valuation, institutional ownership, risk, profitability, analyst recommendations and dividends.

Insider & Institutional Ownership

56.6% of Westwood Holdings Group shares are owned by institutional investors. 17.4% of Westwood Holdings Group shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares Westwood Holdings Group and GAM”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Westwood Holdings Group	$99.48 million	1.83	$7.06 million	$0.83	23.16
GAM	N/A	N/A	N/A	$0.20	0.71

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

Dividends

Westwood Holdings Group pays an annual dividend of $0.60 per share and has a dividend yield of 3.1%. GAM pays an annual dividend of $0.12 per share and has a dividend yield of 82.1%. Westwood Holdings Group pays out 72.3% of its earnings in the form of a dividend. GAM pays out 58.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. GAM is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a summary of current ratings and target prices for Westwood Holdings Group and GAM, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Westwood Holdings Group	0	0	1	0	3.00
GAM	0	0	0	0	0.00

Profitability

This table compares Westwood Holdings Group and GAM’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Westwood Holdings Group	7.40%	8.34%	6.82%
GAM	N/A	N/A	N/A

Summary

Westwood Holdings Group beats GAM on 10 of the 12 factors compared between the two stocks.

About Westwood Holdings Group

Westwood Holdings Group, Inc., through its subsidiaries, manages investment assets and provides services for its clients. The company operates in two segments, Advisory and Trust. The Advisory segment provides investment advisory services to corporate retirement plans, public retirement plans, endowments, foundations, individuals, and the Westwood Funds; and investment sub-advisory services to mutual funds, pooled investment vehicles, and its Trust segment. The Trust segment offers trust and custodial services; and participates in common trust funds that it sponsors to institutions and high net worth individuals. Westwood Holdings Group, Inc. was founded in 1983 and is based in Dallas, Texas.

About GAM

GAM Holding AG is a publicly owned asset management holding company. The firm provides its services to institutions, financial intermediaries and private investors. Through its subsidiaries, the firm manages separate client focused equity and fixed income portfolios. Through its subsidiaries, it also launches and manages equity, fixed income, and balanced mutual funds. Through its subsidiaries, the firm invests in public equity and fixed income markets. GAM Holding AG is based in Zurich, Switzerland with an additional office in Geneva, Switzerland and London, United Kingdom.