Comparing TPG (NASDAQ:TPG) & BrightSphere Investment Group (NYSE:BSIG)

BrightSphere Investment Group (NYSE:BSIG) and TPG (NASDAQ:TPG) are both finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their earnings, risk, valuation, profitability, dividends, analyst recommendations and institutional ownership.

Risk and Volatility

BrightSphere Investment Group has a beta of 1.42, indicating that its share price is 42% more volatile than the S&P 500. Comparatively, TPG has a beta of 1.52, indicating that its share price is 52% more volatile than the S&P 500.

Dividends

BrightSphere Investment Group pays an annual dividend of $0.04 per share and has a dividend yield of 0.2%. TPG pays an annual dividend of $1.68 per share and has a dividend yield of 2.9%. BrightSphere Investment Group pays out 2.4% of its earnings in the form of a dividend. TPG pays out -1,199.9% 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. TPG is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings & Valuation

This table compares BrightSphere Investment Group and TPG”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
BrightSphere Investment Group	$426.60 million	2.22	$65.80 million	$1.64	15.57
TPG	$2.39 billion	8.83	$80.09 million	($0.14)	-413.04

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

Institutional and Insider Ownership

98.7% of BrightSphere Investment Group shares are owned by institutional investors. Comparatively, 86.8% of TPG shares are owned by institutional investors. 27.7% of BrightSphere Investment Group shares are owned by insiders. Comparatively, 76.5% of TPG shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares BrightSphere Investment Group and TPG’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
BrightSphere Investment Group	15.00%	871.33%	15.43%
TPG	1.08%	24.27%	8.58%

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for BrightSphere Investment Group and TPG, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
BrightSphere Investment Group	0	1	1	0	2.50
TPG	0	6	6	0	2.50

BrightSphere Investment Group presently has a consensus price target of $23.00, suggesting a potential downside of 9.95%. TPG has a consensus price target of $47.25, suggesting a potential downside of 18.30%. Given BrightSphere Investment Group’s higher probable upside, research analysts clearly believe BrightSphere Investment Group is more favorable than TPG.

Summary

TPG beats BrightSphere Investment Group on 8 of the 14 factors compared between the two stocks.

About BrightSphere Investment Group

BrightSphere Investment Group Inc. is a publically owned asset management holding company. The firm provides its services to individuals and institutions. It manages separate client focused portfolios through its subsidiaries. The firm also launches equity mutual funds for its clients. It invests in public equity, fixed income, and alternative investment markets through its subsidiaries. The firm was founded in 1980 is based Boston, Massachusetts. It was formally known as BrightSphere Investment Group plc. BrightSphere Investment Group Inc. was formed in 1980 and is based in Boston, Massachusetts.

About TPG

TPG Inc. operates as an alternative asset manager in the United States and internationally. The company offers investment management services to TPG Funds, limited partners, and other vehicles. It also offers monitoring services to portfolio companies; advisory, debt and equity arrangement, and underwriting and placement services; and capital structuring and other advisory services to portfolio companies. In addition, the company invests in private equity funds, real estate funds, hedge funds, and credit funds. TPG Inc. was founded in 1992 and is based in Fort Worth, Texas. The company operates as a subsidiary of TPG GP A, LLC.