Contrasting Federated Hermes (FHI) and The Competition

Federated Hermes (NYSE: FHI) is one of 59 publicly-traded companies in the “Investment advice” industry, but how does it weigh in compared to its competitors? We will compare Federated Hermes to related companies based on the strength of its profitability, risk, dividends, valuation, earnings, analyst recommendations and institutional ownership.

Profitability

This table compares Federated Hermes and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Federated Hermes 20.52% 28.65% 15.66%
Federated Hermes Competitors 13.47% 67.09% 8.74%

Institutional & Insider Ownership

82.8% of Federated Hermes shares are held by institutional investors. Comparatively, 51.7% of shares of all “Investment advice” companies are held by institutional investors. 5.5% of Federated Hermes shares are held by insiders. Comparatively, 20.3% of shares of all “Investment advice” companies are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Federated Hermes and its competitors top-line revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Federated Hermes $1.33 billion $272.34 million 13.61
Federated Hermes Competitors $1.47 billion $295.43 million 15.49

Federated Hermes’ competitors have higher revenue and earnings than Federated Hermes. Federated Hermes is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Risk and Volatility

Federated Hermes has a beta of 0.73, indicating that its share price is 27% less volatile than the S&P 500. Comparatively, Federated Hermes’ competitors have a beta of 1.16, indicating that their average share price is 16% more volatile than the S&P 500.

Dividends

Federated Hermes pays an annual dividend of $1.08 per share and has a dividend yield of 3.0%. Federated Hermes pays out 40.1% of its earnings in the form of a dividend. As a group, “Investment advice” companies pay a dividend yield of 3.5% and pay out 45.7% of their earnings in the form of a dividend.

Analyst Recommendations

This is a summary of recent ratings and price targets for Federated Hermes and its competitors, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Federated Hermes 0 0 0 0 N/A
Federated Hermes Competitors 738 2633 2755 149 2.37

As a group, “Investment advice” companies have a potential upside of 1.83%. Given Federated Hermes’ competitors higher probable upside, analysts plainly believe Federated Hermes has less favorable growth aspects than its competitors.

Summary

Federated Hermes competitors beat Federated Hermes on 8 of the 12 factors compared.

About Federated Hermes

Federated Investors, Inc. engages in the provision of investment management products and related financial services. It sponsors, markets and provides investment-related services to sponsored investment companies, Federated Funds, and Separate Accounts which include separately managed accounts (SMAs), institutional accounts, sub-advised funds and other managed products in both domestic and international markets. The company was founded by John F. Donahue and Richard B. Fisher in October 1955 and is headquartered in Pittsburgh, PA.

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