Contrasting JMP Group (JMP) & Blackstone Group (BX)

JMP Group (NYSE: JMP) and Blackstone Group (NYSE:BX) are both finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their risk, earnings, dividends, analyst recommendations, institutional ownership, valuation and profitability.

Profitability

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This table compares JMP Group and Blackstone Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
JMP Group -14.48% 3.60% 0.45%
Blackstone Group 20.66% 22.27% 9.43%

Dividends

JMP Group pays an annual dividend of $0.36 per share and has a dividend yield of 7.1%. Blackstone Group pays an annual dividend of $3.40 per share and has a dividend yield of 10.6%. JMP Group pays out 180.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Blackstone Group pays out 121.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Blackstone Group has increased its dividend for 5 consecutive years. Blackstone Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk and Volatility

JMP Group has a beta of 0.76, indicating that its share price is 24% less volatile than the S&P 500. Comparatively, Blackstone Group has a beta of 1.33, indicating that its share price is 33% more volatile than the S&P 500.

Institutional and Insider Ownership

13.7% of JMP Group shares are owned by institutional investors. Comparatively, 48.5% of Blackstone Group shares are owned by institutional investors. 52.1% of JMP Group shares are owned by company insiders. Comparatively, 1.0% of Blackstone Group shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current ratings and price targets for JMP Group and Blackstone Group, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
JMP Group 0 1 0 0 2.00
Blackstone Group 0 2 7 0 2.78

JMP Group currently has a consensus target price of $5.75, indicating a potential upside of 13.86%. Blackstone Group has a consensus target price of $40.67, indicating a potential upside of 27.28%. Given Blackstone Group’s stronger consensus rating and higher possible upside, analysts clearly believe Blackstone Group is more favorable than JMP Group.

Earnings and Valuation

This table compares JMP Group and Blackstone Group’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
JMP Group $109.87 million 0.99 -$15.91 million $0.20 25.25
Blackstone Group $7.12 billion 2.96 $1.47 billion $2.81 11.37

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

Summary

Blackstone Group beats JMP Group on 15 of the 17 factors compared between the two stocks.

About JMP Group

JMP Group LLC, formerly JMP Group, Inc., is a full-service investment banking and asset management firm. The Company operates in five segments: Broker-Dealer, Asset Management, Corporate Credit, Investment Income and Corporate Costs. The Broker-Dealer segment includes a range of services, such as underwriting and acting as a placement agent for public and private capital markets raising transactions and financial advisory services in mergers and acquisitions, restructuring and other strategic transactions. The Asset Management segment includes the management of a range of pooled investment vehicles. The Corporate Credit segment includes the management of collateralized loan obligations and small business loans. The Investment Income segment includes income from the Company’s principal investments in public and private securities.

About Blackstone Group

The Blackstone Group L.P. is a global alternative asset manager. The Company’s alternative asset management businesses include investment vehicles focused on private equity, non-investment grade credit, secondary private equity funds of funds and multi-asset class strategies. It operates through four segments: Private Equity, Real Estate, Hedge Fund Solutions and Credit. The Private Equity segment includes its corporate private equity business, which consists of its corporate private equity funds, Blackstone Capital Partners (BCP) funds, its sector-focused corporate private equity funds, including its energy-focused funds, Blackstone Energy Partners (BEP) funds and its core private equity fund. The Blackstone Real Estate Partners funds target a range of opportunistic real estate and real estate related investments. The Hedge Fund Solutions segment consists of Blackstone Alternative Asset Management (BAAM). The Credit segment consists principally of GSO Capital Partners LP (GSO).

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