Critical Analysis: Ridgepost Capital (NYSE:RPC) vs. Raymond James Financial (NYSE:RJF)

Raymond James Financial (NYSE:RJF) and Ridgepost Capital (NYSE:RPC) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, risk, earnings, dividends, analyst recommendations, institutional ownership and profitability.

Analyst Ratings

This is a summary of current ratings and recommmendations for Raymond James Financial and Ridgepost Capital, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Raymond James Financial	0	9	5	0	2.36
Ridgepost Capital	0	2	2	0	2.50

Raymond James Financial currently has a consensus price target of $181.46, indicating a potential upside of 10.29%. Ridgepost Capital has a consensus price target of $13.00, indicating a potential upside of 65.12%. Given Ridgepost Capital’s stronger consensus rating and higher possible upside, analysts plainly believe Ridgepost Capital is more favorable than Raymond James Financial.

Dividends

Raymond James Financial pays an annual dividend of $2.16 per share and has a dividend yield of 1.3%. Ridgepost Capital pays an annual dividend of $0.16 per share and has a dividend yield of 2.0%. Raymond James Financial pays out 18.8% of its earnings in the form of a dividend. Ridgepost Capital pays out 64.0% 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. Raymond James Financial has increased its dividend for 3 consecutive years.

Profitability

This table compares Raymond James Financial and Ridgepost Capital’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Raymond James Financial	13.57%	19.07%	2.64%
Ridgepost Capital	9.03%	21.02%	9.21%

Insider & Institutional Ownership

83.8% of Raymond James Financial shares are owned by institutional investors. Comparatively, 48.0% of Ridgepost Capital shares are owned by institutional investors. 0.6% of Raymond James Financial shares are owned by company insiders. Comparatively, 11.8% of Ridgepost Capital shares are owned 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.

Risk & Volatility

Raymond James Financial has a beta of 0.91, meaning that its share price is 9% less volatile than the S&P 500. Comparatively, Ridgepost Capital has a beta of 0.87, meaning that its share price is 13% less volatile than the S&P 500.

Valuation & Earnings

This table compares Raymond James Financial and Ridgepost Capital”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Raymond James Financial	$15.91 billion	1.99	$2.13 billion	$11.47	14.34
Ridgepost Capital	$297.35 million	2.92	$19.50 million	$0.25	31.49

Raymond James Financial has higher revenue and earnings than Ridgepost Capital. Raymond James Financial is trading at a lower price-to-earnings ratio than Ridgepost Capital, indicating that it is currently the more affordable of the two stocks.

Summary

Raymond James Financial beats Ridgepost Capital on 9 of the 17 factors compared between the two stocks.

About Raymond James Financial

Raymond James Financial, Inc., a financial holding company, through its subsidiaries, engages in the underwriting, distribution, trading, and brokerage of equity and debt securities, and the sale of mutual funds and other investment products in the United States, Canada, Europe, and internationally. The company operates through Private Client Group, Capital Markets, Asset Management, RJ Bank, and Other segments. The Private Client Group segment provides securities brokerage services, including the sale of equities, mutual funds, fixed income products, and insurance products to their individual clients; and borrowing and lending of securities to and from other broker-dealers, financial institutions, and other counterparties. The Capital Markets segment offers securities brokerage, trading, and research services to institutions with a focus on sale of the United States and Canadian equities and fixed income products; and manages and participates in underwritings, merger and acquisition services, and public finance activities. The Asset Management segment engages in the operations of Eagle, the Eagle Family of Funds, Cougar, the asset management operations of Raymond James & Associates, trust services of Raymond James Trust, and other fee-based asset management programs. The RJ Bank segment provides corporate loans, SBL, tax-exempt loans, and residential loans. The Other segment engages in private equity activities, including various direct and third party private equity investments; and private equity funds. Raymond James Financial, Inc. was founded in 1962 and is based in St. Petersburg, Florida.

About Ridgepost Capital

P10, Inc., together with its subsidiaries, operates as a multi-asset class private market solutions provider in the alternative asset management industry in the United States. The company offers private equity, venture capital, private credit, impact investing, and private credit services, as well as primary fund of funds, secondary investment, and direct and co-investments services. It also provides tax credit transaction and consulting services. The company was founded in 1992 and is headquartered in Dallas, Texas.