Analyzing Futu (FHL) and Piper Jaffray Companies (PJC)

Futu (NASDAQ:FHL) and Piper Jaffray Companies (NYSE:PJC) are both small-cap business services companies, but which is the better stock? We will contrast the two companies based on the strength of their earnings, institutional ownership, valuation, risk, dividends, profitability and analyst recommendations.

Dividends

Piper Jaffray Companies pays an annual dividend of $1.50 per share and has a dividend yield of 2.0%. Futu does not pay a dividend. Piper Jaffray Companies pays out 24.5% of its earnings in the form of a dividend.

Institutional & Insider Ownership

73.7% of Piper Jaffray Companies shares are held by institutional investors. 4.2% of Piper Jaffray Companies shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Futu and Piper Jaffray Companies’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Futu N/A N/A N/A
Piper Jaffray Companies 6.44% 11.72% 5.83%

Valuation & Earnings

This table compares Futu and Piper Jaffray Companies’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Futu N/A N/A N/A N/A N/A
Piper Jaffray Companies $800.99 million 1.37 $57.04 million $6.13 12.26

Piper Jaffray Companies has higher revenue and earnings than Futu.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Futu and Piper Jaffray Companies, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Futu 0 2 0 0 2.00
Piper Jaffray Companies 0 1 0 0 2.00

Futu currently has a consensus target price of $17.62, indicating a potential upside of 8.36%. Given Futu’s higher probable upside, analysts clearly believe Futu is more favorable than Piper Jaffray Companies.

Summary

Piper Jaffray Companies beats Futu on 7 of the 9 factors compared between the two stocks.

Futu Company Profile

Futu Holdings Limited operates digitized brokerage platform in Hong Kong, China, Japan, the United States, and internationally. Its platform offers investing services, including trade execution and margin financing which allows to trade securities, such as stocks, warrants, options and exchange-traded funds, or ETFs, across different markets; market data and information; and securities lending services. The company was founded in 2011 and is headquartered in Sheung Wan, Hong Kong.

Piper Jaffray Companies Company Profile

Piper Jaffray Companies operates as an investment bank and asset management firm that serves corporations, private equity groups, public entities, non-profit entities, and institutional investors in the United States and internationally. The company's Capital Markets segment offers investment banking and institutional sales, trading, and research services for various equity and fixed income products. It raises capital through equity and debt financings; provides advisory services related to mergers and acquisitions, equity private placements, and debt and restructuring advisory for corporate clients; underwrites debt issuances; and offers municipal financial advisory and loan placement services, as well as various over-the-counter derivative products. It also provides public finance investment banking capabilities that focus on state and local governments, and cultural and social service non-profit entities, as well as the education, healthcare, hospitality, senior living, and transportation sectors. In addition, this segment offers equity and fixed income advisory and trade execution services for institutional investors, and government and non-profit entities; and engages in trading activities for customer facilitation and strategic trading purposes. Further, it is involved in the merchant banking activities, which comprise equity investments in late stage private companies, and private equity funds and other firm investments; and operates alternative asset management funds in merchant banking, energy, and senior living to invest firm capital and to manage capital from outside investors. The company's Asset Management segment provides asset management services with product offerings in equity securities and master limited partnerships to institutions and individuals through separately managed accounts, and open-end and closed-end funds. Piper Jaffray Companies was founded in 1895 and is headquartered in Minneapolis, Minnesota.

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