AllianceBernstein (NYSE: AB) and Virtus Investment Partners (NASDAQ:VRTS) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their valuation, risk, analyst recommendations, profitability, institutional ownership, dividends and earnings.

Profitability

This table compares AllianceBernstein and Virtus Investment Partners’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AllianceBernstein 6.38% 13.72% 13.72%
Virtus Investment Partners 11.64% 12.75% 3.21%

Valuation & Earnings

This table compares AllianceBernstein and Virtus Investment Partners’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
AllianceBernstein $3.03 billion 0.80 $216.58 million $2.12 12.19
Virtus Investment Partners $322.55 million 2.61 $48.50 million $5.12 22.93

AllianceBernstein has higher revenue and earnings than Virtus Investment Partners. AllianceBernstein is trading at a lower price-to-earnings ratio than Virtus Investment Partners, indicating that it is currently the more affordable of the two stocks.

Dividends

AllianceBernstein pays an annual dividend of $2.04 per share and has a dividend yield of 7.9%. Virtus Investment Partners pays an annual dividend of $1.80 per share and has a dividend yield of 1.5%. AllianceBernstein pays out 96.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Virtus Investment Partners pays out 35.2% of its earnings in the form of a dividend.

Volatility & Risk

AllianceBernstein has a beta of 1.59, meaning that its share price is 59% more volatile than the S&P 500. Comparatively, Virtus Investment Partners has a beta of 1.89, meaning that its share price is 89% more volatile than the S&P 500.

Institutional & Insider Ownership

20.8% of AllianceBernstein shares are held by institutional investors. Comparatively, 95.8% of Virtus Investment Partners shares are held by institutional investors. 2.7% of AllianceBernstein shares are held by company insiders. Comparatively, 4.0% of Virtus Investment Partners shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings for AllianceBernstein and Virtus Investment Partners, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AllianceBernstein 0 1 4 0 2.80
Virtus Investment Partners 0 5 0 0 2.00

AllianceBernstein presently has a consensus target price of $27.50, suggesting a potential upside of 6.38%. Virtus Investment Partners has a consensus target price of $130.00, suggesting a potential upside of 10.73%. Given Virtus Investment Partners’ higher possible upside, analysts clearly believe Virtus Investment Partners is more favorable than AllianceBernstein.

Summary

Virtus Investment Partners beats AllianceBernstein on 9 of the 16 factors compared between the two stocks.

AllianceBernstein Company Profile

AllianceBernstein Holding L.P. is engaged in providing research, investment management and related services to a range of clients through its three buy-side distribution channels: Institutions, Retail and Private Wealth Management, and its sell-side business, Bernstein Research Services. The Company offers a range of investment services, including equity strategies, with global and regional portfolios across capitalization ranges and investment strategies, including value, growth and equities; traditional and unconstrained fixed income strategies, including taxable and tax-exempt strategies; passive management, including index and enhanced index strategies; alternative investments, including hedge funds, fund of funds and private equity, and multi-asset solutions and services, including dynamic asset allocation, customized target-date funds and target-risk funds. The Company’s services span various investment disciplines, including market capitalization, term and geographic locations.

Virtus Investment Partners Company Profile

Virtus Investment Partners, Inc. (Virtus) is a provider of investment management and related services to individuals and institutions. The Company provides its products in various forms and through multiple distribution channels. Its retail products include open-end mutual funds, closed-end funds, exchange traded funds, variable insurance funds, undertakings for collective investments in transferable securities (UCITS) and separately managed accounts. Its open-end mutual funds are distributed through intermediaries. Its closed-end funds trade on the New York Stock Exchange. Its variable insurance funds are available as investment options in variable annuities and life insurance products distributed by life insurance companies. Separately managed accounts consists of intermediary programs, sponsored and distributed by unaffiliated brokerage firms, and private client accounts, which are offered to the high net-worth clients of its affiliated managers.

Receive News & Ratings for AllianceBernstein Holding LP Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for AllianceBernstein Holding LP and related companies with MarketBeat.com's FREE daily email newsletter.