Contrasting T. Rowe Price Group (NASDAQ:TROW) and ONEX (OTCMKTS:ONEXF)

ONEX (OTCMKTS:ONEXF) and T. Rowe Price Group (NASDAQ:TROW) are both finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their valuation, dividends, earnings, risk, profitability, analyst recommendations and institutional ownership.

Volatility & Risk

ONEX has a beta of 1.2, suggesting that its share price is 20% more volatile than the S&P 500. Comparatively, T. Rowe Price Group has a beta of 1.51, suggesting that its share price is 51% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for ONEX and T. Rowe Price Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ONEX	0	1	2	0	2.67
T. Rowe Price Group	5	10	0	0	1.67

T. Rowe Price Group has a consensus price target of $99.54, indicating a potential downside of 2.80%. Given T. Rowe Price Group’s higher possible upside, analysts clearly believe T. Rowe Price Group is more favorable than ONEX.

Dividends

ONEX pays an annual dividend of $0.29 per share and has a dividend yield of 0.4%. T. Rowe Price Group pays an annual dividend of $5.20 per share and has a dividend yield of 5.1%. ONEX pays out 3.3% of its earnings in the form of a dividend. T. Rowe Price Group pays out 55.7% 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. T. Rowe Price Group has increased its dividend for 39 consecutive years. T. Rowe Price Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider and Institutional Ownership

0.7% of ONEX shares are owned by institutional investors. Comparatively, 73.4% of T. Rowe Price Group shares are owned by institutional investors. 1.6% of T. Rowe Price Group shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares ONEX and T. Rowe Price Group”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ONEX	$899.00 million	6.21	$617.00 million	$8.87	9.18
T. Rowe Price Group	$7.31 billion	3.00	$2.09 billion	$9.33	10.98

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

Profitability

This table compares ONEX and T. Rowe Price Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ONEX	68.63%	7.16%	4.75%
T. Rowe Price Group	28.28%	20.60%	15.55%

Summary

T. Rowe Price Group beats ONEX on 12 of the 17 factors compared between the two stocks.

About ONEX

Onex Corporation is a private equity firm specializing in acquisitions and platform acquisitions. The firm makes investments in buyouts, large- middle market, large-cap, mid-cap, and small-cap market and distressed companies. It also invests in recapitalization, growth capital, corporate carve-outs of subsidiaries and mission-critical supply divisions from multinational corporations, operational restructurings of undervalued businesses, and builds up. The firm seeks to invest in technology, electronics manufacturing services, industrial, aerospace, healthcare, retail, restaurants, industrials products, customer care services, metal services, building products, entertainment, gaming, cabinetry products, commercial vehicles, commercial and investment banking, financial services, commercial and multi-unit residential real estate. It invests in global businesses headquartered in North America, including United States and Canada, or Europe. The firm seeks to invest between $125 million and $1 billion in companies that have minimum revenues of $300 million. It does not consider size if the company is in an industry in which the firm already has presence. The firm seeks to make direct as well as co-investments through managed private equity, real estate and credit funds. It seeks to acquire a control position in its portfolio companies. Onex Corporation was founded in 1984 and is based in Toronto, Canada with additional offices in New York, New York; Englewood Cliffs, New Jersey; Boston, Massachusetts and London, United Kingdom.

About T. Rowe Price Group

T. Rowe Price Group, Inc. is a publicly owned investment manager. The firm provides its services to individuals, institutional investors, retirement plans, financial intermediaries, and institutions. It launches and manages equity and fixed income mutual funds. The firm invests in the public equity and fixed income markets across the globe. It employs fundamental and quantitative analysis with a bottom-up approach. The firm utilizes in-house and external research to make its investments. It employs socially responsible investing with a focus on environmental, social, and governance issues. It makes investment in late-stage venture capital transactions and usually invests between $3 million and $5 million. The firm was previously known as T. Rowe Group, Inc. and T. Rowe Price Associates, Inc. T. Rowe Price Group, Inc. was founded in 1937 and is based in Baltimore, Maryland, with additional offices in Colorado Springs, Colorado; Owings Mills, Maryland; San Francisco, California; New York, New York; Philadelphia, Pennsylvania; Tampa, Florida; Toronto, Ontario; Hellerup, Denmark; Amsterdam, The Netherlands; Luxembourg, Grand Duchy of Luxembourg; Zurich, Switzerland; Dubai, United Arab Emirates; London, United Kingdom; Sydney, New South Wales; Hong Kong; Tokyo, Japan; Singapore; Frankfurt, Shanghai, China; Germany, Madrid, Spain, Milan, Italy, Stockholm, Sweden, Melbourne, Australia, Amsterdam, Netherlands and Washington, DC.