Analyzing Westwood Holdings Group (NYSE:WHG) & UBS Group (NYSE:UBS)

UBS Group (NYSE:UBS) and Westwood Holdings Group (NYSE:WHG) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, earnings, analyst recommendations, institutional ownership, profitability, valuation and risk.

Analyst Recommendations

This is a breakdown of current ratings and target prices for UBS Group and Westwood Holdings Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
UBS Group	2	4	6	1	2.46
Westwood Holdings Group	0	0	1	0	3.00

UBS Group currently has a consensus target price of $60.30, indicating a potential upside of 27.31%. Given UBS Group’s higher probable upside, research analysts plainly believe UBS Group is more favorable than Westwood Holdings Group.

Institutional and Insider Ownership

56.6% of Westwood Holdings Group shares are held by institutional investors. 1.0% of UBS Group shares are held by insiders. Comparatively, 17.4% of Westwood Holdings Group shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Dividends

UBS Group pays an annual dividend of $0.36 per share and has a dividend yield of 0.8%. Westwood Holdings Group pays an annual dividend of $0.60 per share and has a dividend yield of 3.2%. UBS Group pays out 12.2% of its earnings in the form of a dividend. Westwood Holdings Group pays out 68.2% 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. UBS Group has increased its dividend for 5 consecutive years.

Profitability

This table compares UBS Group and Westwood Holdings Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
UBS Group	13.10%	10.50%	0.57%
Westwood Holdings Group	7.73%	8.10%	6.59%

Earnings and Valuation

This table compares UBS Group and Westwood Holdings Group”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
UBS Group	$76.12 billion	1.94	$7.77 billion	$2.94	16.11
Westwood Holdings Group	$97.76 million	1.84	$7.06 million	$0.88	21.57

UBS Group has higher revenue and earnings than Westwood Holdings Group. UBS Group is trading at a lower price-to-earnings ratio than Westwood Holdings Group, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

UBS Group has a beta of 1.21, meaning that its share price is 21% more volatile than the S&P 500. Comparatively, Westwood Holdings Group has a beta of 0.51, meaning that its share price is 49% less volatile than the S&P 500.

Summary

UBS Group beats Westwood Holdings Group on 12 of the 18 factors compared between the two stocks.

About UBS Group

UBS Group AG provides financial advice and solutions to private, institutional, and corporate clients worldwide. It operates through five divisions: Global Wealth Management, Personal & Corporate Banking, Asset Management, Investment Bank, and Non-core and Legacy. The company offers investment advice, estate and wealth planning, investing, corporate and banking, and investment management, as well as mortgage, securities-based, and structured lending solutions. It also provides personal banking products and services, such as deposits, credit and debit cards, and online and mobile banking, as well as lending, investments, retirement, and wealth management services; and corporate and institutional solutions, including equity and debt capital markets, syndicated and structured credit, private placements, leasing, traditional financing, and transaction banking solutions for payment and cash management services, trade and export finance, and global custody solutions. In addition, the company offers equities, fixed income, hedge funds, real estate and private markets, indexed and alternative beta strategies, asset allocation and currency investment strategies, customized multi-asset solutions, advisory and fiduciary services, and multi-manager hedge fund solutions and advisory services. Further, it advises clients on strategic business opportunities and helps them raise capital to fund their activities; enables its clients to buy, sell, and finance securities on capital markets and to manage their risks and liquidity; distributes, trades in, finances, and clears cash equities and equity-linked products; structures, originates, and distributes new equity and equity-linked issues; and originates, distributes, manages risk, and provides liquidity in foreign exchange, rates, credit and precious metals. The company was formerly known as UBS AG and changed its name to UBS Group AG in December 2014. UBS Group AG was founded in 1862 and is headquartered in Zurich, Switzerland.

About Westwood Holdings Group

Westwood Holdings Group, Inc., through its subsidiaries, manages investment assets and provides services for its clients. The company operates in two segments, Advisory and Trust. The Advisory segment provides investment advisory services to corporate retirement plans, public retirement plans, endowments, foundations, individuals, and the Westwood Funds; and investment sub-advisory services to mutual funds, pooled investment vehicles, and its Trust segment. The Trust segment offers trust and custodial services; and participates in common trust funds that it sponsors to institutions and high net worth individuals. Westwood Holdings Group, Inc. was founded in 1983 and is based in Dallas, Texas.