Financial Survey: StoneX Group (NASDAQ:SNEX) and Houlihan Lokey (NYSE:HLI)

StoneX Group (NASDAQ:SNEX) and Houlihan Lokey (NYSE:HLI) are both mid-cap finance companies, but which is the superior stock? We will compare the two companies based on the strength of their valuation, dividends, profitability, earnings, risk, analyst recommendations and institutional ownership.

Volatility & Risk

StoneX Group has a beta of 0.63, meaning that its stock price is 37% less volatile than the S&P 500. Comparatively, Houlihan Lokey has a beta of 0.96, meaning that its stock price is 4% less volatile than the S&P 500.

Profitability

This table compares StoneX Group and Houlihan Lokey’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
StoneX Group	0.33%	20.18%	1.05%
Houlihan Lokey	16.10%	20.20%	11.71%

Institutional and Insider Ownership

75.9% of StoneX Group shares are owned by institutional investors. Comparatively, 78.1% of Houlihan Lokey shares are owned by institutional investors. 11.8% of StoneX Group shares are owned by insiders. Comparatively, 22.5% of Houlihan Lokey shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Valuation and Earnings

This table compares StoneX Group and Houlihan Lokey”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
StoneX Group	$132.38 billion	0.06	$305.90 million	$4.19	15.63
Houlihan Lokey	$2.62 billion	3.37	$425.70 million	$5.95	21.44

Houlihan Lokey has lower revenue, but higher earnings than StoneX Group. StoneX Group is trading at a lower price-to-earnings ratio than Houlihan Lokey, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for StoneX Group and Houlihan Lokey, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
StoneX Group	0	1	2	1	3.00
Houlihan Lokey	1	4	5	0	2.40

StoneX Group currently has a consensus price target of $112.00, suggesting a potential upside of 71.04%. Houlihan Lokey has a consensus price target of $166.38, suggesting a potential upside of 30.42%. Given StoneX Group’s stronger consensus rating and higher probable upside, equities analysts plainly believe StoneX Group is more favorable than Houlihan Lokey.

Summary

Houlihan Lokey beats StoneX Group on 11 of the 15 factors compared between the two stocks.

About StoneX Group

StoneX Group Inc. operates as a global financial services network that connects companies, organizations, traders, and investors to market ecosystem worldwide. The company operates through Commercial, Institutional, Retail, and Global Payments segments. The Commercial segment provides risk management and hedging, exchange-traded and OTC products execution and clearing, voice brokerage, market intelligence, physical trading, and commodity financing and logistics services. The Institutional segment offers equity trading services to institutional clients; clearing and execution services in futures exchanges; brokerage foreign exchange services for the financial institutions and professional traders; and OTC products, as well as originates, structures, and places debt instruments in capital markets. This segment also operates as an institutional dealer in fixed income securities to serve asset managers, commercial bank trust and investment departments, broker-dealers, and insurance companies, as well as engages in asset management business. The Retail segment provides trading services and solutions in the global financial markets, including spot foreign exchange, precious metals trading, and contracts for differences; and wealth management services, as well as offers physical gold and other precious metals in various forms and denominations through Stonexbullion.com. The Global Payments segment provides customized payment, technology, and treasury services to banks and commercial businesses, charities, and non-governmental and government organizations; and pricing and payments services. The company was formerly known as INTL FCStone Inc. and changed its name to StoneX Group Inc. in July 2020. StoneX Group Inc. was founded in 1924 and is headquartered in New York, New York.

About Houlihan Lokey

Houlihan Lokey, Inc., an investment banking company, provides merger and acquisition (M&A), capital market, financial restructuring, and financial and valuation advisory services worldwide. It operates in three segments: Corporate Finance, Financial Restructuring, and Financial and Valuation Advisory. The Corporate Finance segment offers general financial advisory services; and advises public and private institutions on buy-side and sell-side transactions, leveraged loans, private mezzanine debt, high-yield debt, initial public offerings, follow-ons, convertibles, equity private placements, private equity, and liability management transactions, as well as advise financial sponsors on various transactions. The Financial Restructuring segment advises debtors, creditors, and other parties-in-interest related to recapitalization/deleveraging transactions. It also provides a range of advisory services, including structuring, negotiation, and confirmation of plans of reorganization; structuring and analysis of exchange offers; corporate viability assessment; dispute resolution and expert testimony; and procuring debtor-in-possession financing. The Financial and Valuation Advisory segment offers valuations of various assets, such as companies, illiquid debt and equity securities, and intellectual property. It also provides fairness opinions in connection with M&A and other transactions, solvency opinions in connection with corporate spin-offs and dividend recapitalizations, and other types of financial opinions. In addition, this segment offers dispute resolution services. It serves corporations, financial sponsors, and government agencies. The company was incorporated in 1972 and is headquartered in Los Angeles, California.