Interactive Brokers Group (NASDAQ:IBKR – Get Free Report) and Diamond Hill Investment Group (NASDAQ:DHIL – Get Free Report) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their dividends, valuation, analyst recommendations, institutional ownership, risk, profitability and earnings.
Volatility and Risk
Interactive Brokers Group has a beta of 1.24, indicating that its stock price is 24% more volatile than the S&P 500. Comparatively, Diamond Hill Investment Group has a beta of 0.78, indicating that its stock price is 22% less volatile than the S&P 500.
Profitability
This table compares Interactive Brokers Group and Diamond Hill Investment Group’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Interactive Brokers Group | 9.44% | 5.12% | 0.52% |
| Diamond Hill Investment Group | 31.32% | 20.71% | 14.34% |
Analyst Ratings
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Interactive Brokers Group | 0 | 1 | 7 | 1 | 3.00 |
| Diamond Hill Investment Group | 0 | 1 | 0 | 0 | 2.00 |
Interactive Brokers Group currently has a consensus price target of $76.39, indicating a potential upside of 2.20%. Given Interactive Brokers Group’s stronger consensus rating and higher possible upside, equities analysts plainly believe Interactive Brokers Group is more favorable than Diamond Hill Investment Group.
Earnings & Valuation
This table compares Interactive Brokers Group and Diamond Hill Investment Group”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Interactive Brokers Group | $10.42 billion | 12.16 | $984.00 million | $2.21 | 33.82 |
| Diamond Hill Investment Group | $151.10 million | 3.06 | $43.18 million | $17.22 | 9.92 |
Interactive Brokers Group has higher revenue and earnings than Diamond Hill Investment Group. Diamond Hill Investment Group is trading at a lower price-to-earnings ratio than Interactive Brokers Group, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
23.8% of Interactive Brokers Group shares are held by institutional investors. Comparatively, 65.5% of Diamond Hill Investment Group shares are held by institutional investors. 3.0% of Interactive Brokers Group shares are held by insiders. Comparatively, 4.6% of Diamond Hill Investment Group shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Dividends
Interactive Brokers Group pays an annual dividend of $0.32 per share and has a dividend yield of 0.4%. Diamond Hill Investment Group pays an annual dividend of $6.00 per share and has a dividend yield of 3.5%. Interactive Brokers Group pays out 14.5% of its earnings in the form of a dividend. Diamond Hill Investment Group pays out 34.8% 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. Interactive Brokers Group has increased its dividend for 2 consecutive years.
Summary
Interactive Brokers Group beats Diamond Hill Investment Group on 11 of the 18 factors compared between the two stocks.
About Interactive Brokers Group
Interactive Brokers Group, Inc. operates as an automated electronic broker worldwide. The company engages in the execution, clearance, and settlement of trades in stocks, options, futures, foreign exchange instruments, bonds, mutual funds, exchange traded funds (ETFs), precious metals, and cryptocurrencies. It also custodies and services accounts for hedge and mutual funds, ETFs, registered investment advisors, proprietary trading groups, introducing brokers, and individual investors. In addition, the company offers custody, prime brokerage, securities, and margin lending services. It serves institutional and individual customers through electronic exchanges and market centers. The company was founded in 1977 and is headquartered in Greenwich, Connecticut.
About Diamond Hill Investment Group
Diamond Hill Investment Group, Inc., through its subsidiary, Diamond Hill Capital Management, Inc., provides investment advisory and fund administration services in the United States. It offers investment advisory and related services to clients through pooled vehicles, such as private fund; separately managed accounts; collective investment trusts; and other pooled vehicles, including sub-advised funds and model delivery programs. The company also provides fund administration services comprising portfolio and regulatory compliance, treasury and financial oversight, and general business management and governance of the funds, as well as oversight of back-office service providers, which include the custodian, fund accountant, and transfer agent. Diamond Hill Investment Group, Inc. was incorporated in 1990 and is based in Columbus, Ohio.
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