Critical Survey: Jefferies Financial Group (NYSE:JEF) & First Trust Senior Floating Rate Income Fund II (NYSE:FCT)

First Trust Senior Floating Rate Income Fund II (NYSE:FCT) and Jefferies Financial Group (NYSE:JEF) are both finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, profitability, analyst recommendations, dividends, earnings, risk and valuation.

Insider & Institutional Ownership

60.9% of Jefferies Financial Group shares are owned by institutional investors. 19.9% of Jefferies Financial Group shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Dividends

First Trust Senior Floating Rate Income Fund II pays an annual dividend of $1.05 per share and has a dividend yield of 10.9%. Jefferies Financial Group pays an annual dividend of $1.60 per share and has a dividend yield of 2.8%. Jefferies Financial Group pays out 44.7% of its earnings in the form of a dividend. Jefferies Financial Group has raised its dividend for 2 consecutive years.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for First Trust Senior Floating Rate Income Fund II and Jefferies Financial Group, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Trust Senior Floating Rate Income Fund II	0	0	0	0	0.00
Jefferies Financial Group	0	5	2	0	2.29

Jefferies Financial Group has a consensus price target of $62.62, indicating a potential upside of 10.87%. Given Jefferies Financial Group’s stronger consensus rating and higher probable upside, analysts clearly believe Jefferies Financial Group is more favorable than First Trust Senior Floating Rate Income Fund II.

Valuation & Earnings

This table compares First Trust Senior Floating Rate Income Fund II and Jefferies Financial Group”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Trust Senior Floating Rate Income Fund II	$17.40 million	N/A	N/A	N/A	N/A
Jefferies Financial Group	$10.82 billion	1.01	$710.47 million	$3.58	15.78

Jefferies Financial Group has higher revenue and earnings than First Trust Senior Floating Rate Income Fund II.

Profitability

This table compares First Trust Senior Floating Rate Income Fund II and Jefferies Financial Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Trust Senior Floating Rate Income Fund II	N/A	N/A	N/A
Jefferies Financial Group	7.58%	9.23%	1.31%

Summary

Jefferies Financial Group beats First Trust Senior Floating Rate Income Fund II on 10 of the 12 factors compared between the two stocks.

About First Trust Senior Floating Rate Income Fund II

First Trust Senior Floating Rate Income Fund II is a closed-ended fixed income mutual fund launched and managed by First Trust Advisors L.P. The fund invests in the fixed income markets of the United States. It seeks to invest in a portfolio of senior secured floating rate corporate loans. The fund benchmarks the performance of its portfolio against the S&P/LSTA Leveraged Loan Index. It was formerly known as First Trust/Four Corners Senior Floating Rate Income Fund II. First Trust Senior Floating Rate Income Fund II was formed on May 25, 2004 and is domiciled in the United States.

About Jefferies Financial Group

Jefferies Financial Group Inc. operates as an investment banking and capital markets firm in the Americas, Europe, the Middle East, and the Asia-Pacific. The company operates in two segments, Investment Banking and Capital Markets, and Asset Management. It provides investment banking, advisory services with respect to mergers or acquisitions, debt financing, restructurings or recapitalizations, and private capital advisory transactions; underwriting and placement services related to corporate debt, municipal bonds, mortgage-backed and asset-backed securities, equity and equity-linked securities, and loan syndication services; and corporate lending services. The company also offers financing, securities lending, and other prime brokerage services; equities research, sales, and trading services; wealth management services; and online foreign exchange trading services. In addition, it provides investment grade distressed debt securities, U.S. and European government and agency securities, municipal bonds, leveraged loans, emerging markets debt, and interest rate and credit index derivative products; and manages and offers services to a diverse group of alternative asset management platforms across a spectrum of investment strategies and asset classes. The company was formerly known as Leucadia National Corporation and changed its name to Jefferies Financial Group Inc. in May 2018. Jefferies Financial Group Inc. was founded in 1962 and is headquartered in New York, New York.