Critical Review: Patria Investments (NYSE:PAX) & WisdomTree (NYSE:WT)

WisdomTree (NYSE:WT) and Patria Investments (NYSE:PAX) are both finance companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, institutional ownership, dividends, earnings, profitability, analyst recommendations and risk.

Analyst Ratings

This is a breakdown of recent ratings and target prices for WisdomTree and Patria Investments, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
WisdomTree	0	2	5	1	2.88
Patria Investments	3	1	1	0	1.60

WisdomTree presently has a consensus target price of $26.05, indicating a potential upside of 22.07%. Patria Investments has a consensus target price of $12.75, indicating a potential upside of 33.13%. Given Patria Investments’ higher possible upside, analysts plainly believe Patria Investments is more favorable than WisdomTree.

Valuation & Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
WisdomTree	$493.75 million	6.55	$109.13 million	$0.52	41.04
Patria Investments	$428.00 million	1.49	$73.40 million	$0.44	21.77

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

Risk & Volatility

WisdomTree has a beta of 1.17, suggesting that its share price is 17% more volatile than the S&P 500. Comparatively, Patria Investments has a beta of 0.8, suggesting that its share price is 20% less volatile than the S&P 500.

Dividends

WisdomTree pays an annual dividend of $0.12 per share and has a dividend yield of 0.6%. Patria Investments pays an annual dividend of $0.65 per share and has a dividend yield of 6.8%. WisdomTree pays out 23.1% of its earnings in the form of a dividend. Patria Investments pays out 147.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Institutional and Insider Ownership

78.6% of WisdomTree shares are owned by institutional investors. Comparatively, 96.3% of Patria Investments shares are owned by institutional investors. 10.1% of WisdomTree shares are owned by insiders. Comparatively, 58.1% of Patria Investments shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares WisdomTree and Patria Investments’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
WisdomTree	13.27%	39.12%	10.29%
Patria Investments	19.91%	38.68%	15.84%

Summary

WisdomTree beats Patria Investments on 11 of the 17 factors compared between the two stocks.

About WisdomTree

WisdomTree, Inc., through its subsidiaries, operates as an exchange-traded funds (ETFs) sponsor and asset manager. It offers ETFs in equities, currency, fixed income, and alternatives asset classes. The company also licenses its indexes to third parties for proprietary products, as well as offers a platform to promote the use of WisdomTree ETFs in 401(k) plans. It develops index using its fundamentally weighted index methodology. In addition, the company provides investment advisory services. The company was founded in 1985 and is based in New York, New York.

About Patria Investments

Patria Investments Limited operates as a private market investment firm focused on investing in Latin America. The company offers asset management services to investors focusing on private equity funds, infrastructure development funds, co-investments funds, constructivist equity funds, and real estate and credit funds. Patria Investments Limited was founded in 1994 and is headquartered in Grand Cayman, the Cayman Islands.