TD Ameritrade Holding Corporation (NASDAQ: AMTD) and Lazard (NYSE:LAZ) are both mid-cap finance companies, but which is the better stock? We will compare the two businesses based on the strength of their analyst recommendations, risk, earnings, institutional ownership, dividends, valuation and profitability.

Profitability

This table compares TD Ameritrade Holding Corporation and Lazard’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
TD Ameritrade Holding Corporation 24.01% 16.09% 2.89%
Lazard 17.39% 39.33% 11.16%

Insider and Institutional Ownership

90.4% of TD Ameritrade Holding Corporation shares are held by institutional investors. Comparatively, 69.1% of Lazard shares are held by institutional investors. 0.4% of TD Ameritrade Holding Corporation shares are held by insiders. Comparatively, 2.5% of Lazard shares are held by 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.

Risk & Volatility

TD Ameritrade Holding Corporation has a beta of 1.48, indicating that its share price is 48% more volatile than the S&P 500. Comparatively, Lazard has a beta of 1.84, indicating that its share price is 84% more volatile than the S&P 500.

Dividends

TD Ameritrade Holding Corporation pays an annual dividend of $0.72 per share and has a dividend yield of 1.6%. Lazard pays an annual dividend of $1.64 per share and has a dividend yield of 3.7%. TD Ameritrade Holding Corporation pays out 45.0% of its earnings in the form of a dividend. Lazard pays out 46.5% 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. TD Ameritrade Holding Corporation has increased its dividend for 6 consecutive years.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for TD Ameritrade Holding Corporation and Lazard, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
TD Ameritrade Holding Corporation 0 6 9 0 2.60
Lazard 0 3 4 0 2.57

TD Ameritrade Holding Corporation currently has a consensus target price of $44.75, suggesting a potential upside of 1.18%. Lazard has a consensus target price of $46.29, suggesting a potential upside of 4.44%. Given Lazard’s higher probable upside, analysts plainly believe Lazard is more favorable than TD Ameritrade Holding Corporation.

Valuation and Earnings

This table compares TD Ameritrade Holding Corporation and Lazard’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
TD Ameritrade Holding Corporation $3.46 billion 6.75 $844.80 million $1.60 27.64
Lazard $2.64 billion 2.18 $458.07 million $3.53 12.56

TD Ameritrade Holding Corporation has higher revenue and earnings than Lazard. Lazard is trading at a lower price-to-earnings ratio than TD Ameritrade Holding Corporation, indicating that it is currently the more affordable of the two stocks.

Summary

TD Ameritrade Holding Corporation beats Lazard on 10 of the 17 factors compared between the two stocks.

TD Ameritrade Holding Corporation Company Profile

TD Ameritrade Holding Corporation is a provider of securities brokerage services and related technology-based financial services. The Company provides its services to retail investors, traders and independent registered investment advisors (RIAs). The Company provides its services through the Internet, a national branch network and relationships with RIAs. The Company’s products and services include common and preferred stock, exchange-traded funds, options, futures, foreign exchange, mutual funds, fixed income, new and secondary issue securities, margin lending, cash management services and annuities. The Company uses its platform to offer brokerage services to retail investors and investment advisors. In addition, it also offers various products and services to retail clients, such as touch-tone trading, trading over the Internet, real-time quotes, extended trading hours and direct access to market destinations.

Lazard Company Profile

Lazard Ltd (Lazard) is a financial advisory and asset management company. The Company operates through two segments: Financial Advisory and Asset Management. It serves a range of clients around the world, including corporations, governments, institutions, partnerships and individuals. The Financial Advisory business segment offers corporate, partnership, institutional, government, sovereign and individual clients across the globe a range of financial advisory services regarding mergers and acquisitions (M&A) and other strategic matters, restructurings, capital structure, capital raising and various other financial matters to corporate, partnership, institutional, government, sovereign and individual clients. The Asset Management business provides investment solutions and investment management services in equity and fixed income strategies, alternative investments and private equity funds to corporations, public funds and sovereign entities.

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