State Street Corporation (STT) vs. Gamco Investors (GBL) Financial Analysis
State Street Corporation (NYSE: STT) and Gamco Investors (NYSE:GBL) are both finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their dividends, valuation, institutional ownership, analyst recommendations, profitability, risk and earnings.
Valuation and Earnings
This table compares State Street Corporation and Gamco Investors’ gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|State Street Corporation||$10.63 billion||3.32||$2.02 billion||$5.40||17.49|
|Gamco Investors||$361.19 million||2.30||$181.57 million||$3.68||7.80|
State Street Corporation has higher revenue and earnings than Gamco Investors. Gamco Investors is trading at a lower price-to-earnings ratio than State Street Corporation, indicating that it is currently the more affordable of the two stocks.
State Street Corporation pays an annual dividend of $1.52 per share and has a dividend yield of 1.6%. Gamco Investors pays an annual dividend of $0.08 per share and has a dividend yield of 0.3%. State Street Corporation pays out 28.1% of its earnings in the form of a dividend. Gamco Investors pays out 2.2% 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. State Street Corporation has raised its dividend for 5 consecutive years and Gamco Investors has raised its dividend for 6 consecutive years.
Insider & Institutional Ownership
87.4% of State Street Corporation shares are held by institutional investors. Comparatively, 25.4% of Gamco Investors shares are held by institutional investors. 0.7% of State Street Corporation shares are held by insiders. Comparatively, 79.0% of Gamco Investors shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Risk and Volatility
State Street Corporation has a beta of 1.31, suggesting that its share price is 31% more volatile than the S&P 500. Comparatively, Gamco Investors has a beta of 1.08, suggesting that its share price is 8% more volatile than the S&P 500.
This table compares State Street Corporation and Gamco Investors’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|State Street Corporation||19.97%||12.49%||0.95%|
This is a breakdown of current recommendations and price targets for State Street Corporation and Gamco Investors, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|State Street Corporation||1||9||3||1||2.29|
State Street Corporation currently has a consensus price target of $93.00, suggesting a potential downside of 1.52%. Given State Street Corporation’s higher possible upside, analysts plainly believe State Street Corporation is more favorable than Gamco Investors.
State Street Corporation beats Gamco Investors on 12 of the 17 factors compared between the two stocks.
State Street Corporation Company Profile
State Street Corporation is a financial holding company. The Company operates through two lines of business: Investment Servicing and Investment Management. The Company, through its subsidiary, State Street Bank and Trust Company (State Street Bank), provides a range of financial products and services to institutional investors across the world. Investment servicing line of business performs functions, such as providing institutional investors with clearing, settlement and payment services. The Company operates investment management line of business through State Street Global Advisors (SSGA). SSGA provides a range of investment management, investment research and investment advisory services to corporations, public funds and other investors. Its clients include mutual funds, collective investment funds and other investment pools, corporate and public retirement plans, insurance companies, foundations, endowments and investment managers.
Gamco Investors Company Profile
GAMCO Investors, Inc. is a holding company. The Company is a provider of investment advisory services to open and closed-end funds, institutional and private wealth management investors principally in the United States. The Company operates through the investment advisory and asset management business segment. It manages assets on a discretionary basis and invests in securities through various investment styles. Its assets under management are organized into three groups: Institutional and Private Wealth Management; Open and Closed-End Funds, and the GAMCO International SICAV (SICAV). The Company provides advisory services to a range of investors, including corporate retirement plans, foundations, endowments and private wealth clients, and also serves as sub-advisor to third-party investment funds, including registered investment companies. As of December 31, 2016, it had provided advisory services to 21 open-end funds, 15 closed-end funds and one exchange traded managed fund.
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