Critical Survey: Heritage Global (HGBL) and The Competition

Heritage Global (NASDAQ:HGBL) is one of 334 publicly-traded companies in the “Financial Services” industry, but how does it contrast to its peers? We will compare Heritage Global to similar businesses based on the strength of its profitability, institutional ownership, analyst recommendations, valuation, risk, dividends and earnings.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Heritage Global and its peers, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Heritage Global	1	0	1	0	2.00
Heritage Global Competitors	1931	6947	11709	447	2.51

Heritage Global currently has a consensus target price of $3.00, indicating a potential upside of 162.93%. As a group, “Financial Services” companies have a potential downside of 5.53%. Given Heritage Global’s higher possible upside, research analysts clearly believe Heritage Global is more favorable than its peers.

Earnings & Valuation

This table compares Heritage Global and its peers gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Heritage Global	$50.98 million	$3.59 million	-2.85
Heritage Global Competitors	$6.95 billion	$1.14 billion	8.61

Heritage Global’s peers have higher revenue and earnings than Heritage Global. Heritage Global is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Profitability

This table compares Heritage Global and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Heritage Global	-26.89%	7.21%	5.39%
Heritage Global Competitors	-259.04%	-39.95%	-4.73%

Insider and Institutional Ownership

33.5% of Heritage Global shares are owned by institutional investors. Comparatively, 43.5% of shares of all “Financial Services” companies are owned by institutional investors. 15.6% of Heritage Global shares are owned by company insiders. Comparatively, 21.9% of shares of all “Financial Services” companies are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Volatility & Risk

Heritage Global has a beta of 0.48, meaning that its stock price is 52% less volatile than the S&P 500. Comparatively, Heritage Global’s peers have a beta of 2.55, meaning that their average stock price is 155% more volatile than the S&P 500.

Summary

Heritage Global peers beat Heritage Global on 9 of the 13 factors compared.

Heritage Global Company Profile

Heritage Global, Inc. (NASDAQ:HGBL) is an asset services company that specializes in the valuation, marketing and disposition of surplus, underutilized and distressed assets. The company serves businesses, lenders, insolvency professionals and other organizations seeking to sell or acquire industrial equipment, machinery, inventory and other tangible assets. Through its operating businesses, including Heritage Global Partners, the company provides auction and liquidation services, negotiated sales, asset advisory services and valuation expertise.