WisdomTree Investments (NASDAQ: WETF) and The Carlyle Group L.P. (NASDAQ:CG) are both small-cap finance companies, but which is the superior stock? We will compare the two companies based on the strength of their risk, valuation, analyst recommendations, earnings, profitabiliy, institutional ownership and dividends.

Earnings & Valuation

This table compares WisdomTree Investments and The Carlyle Group L.P.’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
WisdomTree Investments $212.37 million 6.25 $56.91 million $0.16 61.63
The Carlyle Group L.P. $2.91 billion 0.53 $848.10 million $0.79 22.91

The Carlyle Group L.P. has higher revenue and earnings than WisdomTree Investments. The Carlyle Group L.P. is trading at a lower price-to-earnings ratio than WisdomTree Investments, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent ratings and price targets for WisdomTree Investments and The Carlyle Group L.P., as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
WisdomTree Investments 3 0 3 0 2.00
The Carlyle Group L.P. 0 3 4 0 2.57

WisdomTree Investments presently has a consensus price target of $10.25, indicating a potential upside of 3.96%. The Carlyle Group L.P. has a consensus price target of $18.92, indicating a potential upside of 4.51%. Given The Carlyle Group L.P.’s stronger consensus rating and higher possible upside, analysts clearly believe The Carlyle Group L.P. is more favorable than WisdomTree Investments.

Volatility & Risk

WisdomTree Investments has a beta of 3.03, meaning that its share price is 203% more volatile than the S&P 500. Comparatively, The Carlyle Group L.P. has a beta of 1.84, meaning that its share price is 84% more volatile than the S&P 500.

Insider and Institutional Ownership

95.3% of WisdomTree Investments shares are owned by institutional investors. Comparatively, 45.6% of The Carlyle Group L.P. shares are owned by institutional investors. 16.6% of WisdomTree Investments shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Dividends

WisdomTree Investments pays an annual dividend of $0.32 per share and has a dividend yield of 3.2%. The Carlyle Group L.P. pays an annual dividend of $0.40 per share and has a dividend yield of 2.2%. WisdomTree Investments pays out 200.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. The Carlyle Group L.P. pays out 50.6% of its earnings in the form of a dividend.

Profitability

This table compares WisdomTree Investments and The Carlyle Group L.P.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
WisdomTree Investments 9.83% 11.15% 9.27%
The Carlyle Group L.P. 2.78% 33.76% 5.64%

About WisdomTree Investments

WisdomTree Investments, Inc. is an asset management company that focuses on exchange-traded funds (ETFs). The Company’s family of ETFs includes funds that track its own indexes, funds that track third party indexes and actively managed funds. It operates as an exchange traded products sponsor and asset manager providing investment advisory services in the United States, Europe, Canada and Japan. These activities are reported in its U.S. Business segment that comprises its the United States business and Japan sales office, which primarily engages in selling its United States listed ETFs to Japanese institutions, and International Business segment, that comprises its European business and Canadian business. Its United States listed products include International Hedged Equity ETFs, Equity ETFs, Fixed Income ETFs, Currency ETFs, Alternative Strategy ETFs and Commodity ETFs. Its portfolio of Non-the United States listed products include WisdomTree UCITS ETFs, Boost ETPs and Canadian ETFs.

About The Carlyle Group L.P.

The Carlyle Group L.P. is a diversified multi-product global alternative asset management firm. The Company operates in four segments: Corporate Private Equity (CPE), Real Assets, Global Market Strategies (GMS) and Investment Solutions. Corporate Private Equity advises its buyout and growth capital funds, which pursue various corporate investments of different sizes and growth potentials. As of December 31, 2016, the Real Assets segment advised its 26 active carry funds focused on real estate, infrastructure and energy and natural resources (including power). As of December 31, 2016, the Global Market Strategies segment advised a group of 57 active funds that pursue investment strategies, including leveraged loans and structured credit, energy mezzanine opportunities, middle market lending and distressed debt. Its Investment Solutions segment provides investment opportunities and resources for its investors and clients.

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