Analyzing SEI Investments (NASDAQ:SEIC) and TPG (NASDAQ:TPG)

SEI Investments (NASDAQ:SEIC) and TPG (NASDAQ:TPG) are both large-cap finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, risk, analyst recommendations, earnings, valuation, profitability and institutional ownership.

Profitability

This table compares SEI Investments and TPG’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SEI Investments	28.06%	30.14%	22.75%
TPG	5.32%	29.05%	8.15%

Risk & Volatility

SEI Investments has a beta of 0.97, suggesting that its stock price is 3% less volatile than the S&P 500. Comparatively, TPG has a beta of 1.48, suggesting that its stock price is 48% more volatile than the S&P 500.

Earnings & Valuation

This table compares SEI Investments and TPG”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SEI Investments	$2.30 billion	5.43	$715.30 million	$5.75	18.29
TPG	$4.67 billion	3.85	$184.59 million	$0.87	53.72

SEI Investments has higher earnings, but lower revenue than TPG. SEI Investments is trading at a lower price-to-earnings ratio than TPG, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

70.6% of SEI Investments shares are held by institutional investors. Comparatively, 94.0% of TPG shares are held by institutional investors. 4.8% of SEI Investments shares are held by company insiders. Comparatively, 61.4% of TPG shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Dividends

SEI Investments pays an annual dividend of $1.04 per share and has a dividend yield of 1.0%. TPG pays an annual dividend of $2.36 per share and has a dividend yield of 5.0%. SEI Investments pays out 18.1% of its earnings in the form of a dividend. TPG pays out 271.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. SEI Investments has increased its dividend for 34 consecutive years.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for SEI Investments and TPG, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SEI Investments	0	1	7	1	3.00
TPG	0	4	11	0	2.73

SEI Investments currently has a consensus target price of $125.50, suggesting a potential upside of 19.32%. TPG has a consensus target price of $61.00, suggesting a potential upside of 30.51%. Given TPG’s higher possible upside, analysts clearly believe TPG is more favorable than SEI Investments.

Summary

SEI Investments beats TPG on 10 of the 18 factors compared between the two stocks.

About SEI Investments

SEI Investments Company is a publicly owned asset management holding company. Through its subsidiaries, the firm provides wealth management, retirement and investment solutions, asset management, asset administration, investment processing outsourcing solutions, financial services, and investment advisory services to its clients. It provides its services to private banks, independent financial advisers, institutional investors, investment managers, investment advisors, wealth management organizations, corporations, retirement scheme sponsors, not-for-profit organizations, hedge fund managers, registered investment advisers, independent broker-dealers, financial planners, life insurance agents, defined-benefit schemes, defined-contribution schemes, endowments, foundations, and board-designated fund, through its subsidiaries. Through its subsidiaries, the firm manages separate client-focused portfolios. It also launches and manages equity, fixed income, and balanced mutual funds, through its subsidiaries. Through its subsidiaries, the firm invests in public equity and fixed income markets. It employs fundamental and quantitative analysis with a focus on top-down and bottom-up analysis to make its investments, through its subsidiaries. SEI Investments Company was founded in 1968 and is based in Oaks, Pennsylvania.

About TPG

TPG Inc. operates as an alternative asset manager in the United States and internationally. The company offers investment management services to TPG Funds, limited partners, and other vehicles. It also offers monitoring services to portfolio companies; advisory, debt and equity arrangement, and underwriting and placement services; and capital structuring and other advisory services to portfolio companies. In addition, the company invests in private equity funds, real estate funds, hedge funds, and credit funds. TPG Inc. was founded in 1992 and is based in Fort Worth, Texas. The company operates as a subsidiary of TPG GP A, LLC.