Noah Holdings (NYSE: NOAH) and BlackRock (NYSE:BLK) are both finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, profitabiliy, earnings, risk and valuation.

Volatility & Risk

Noah Holdings has a beta of 2.31, meaning that its share price is 131% more volatile than the S&P 500. Comparatively, BlackRock has a beta of 1.71, meaning that its share price is 71% more volatile than the S&P 500.

Dividends

BlackRock pays an annual dividend of $10.00 per share and has a dividend yield of 2.4%. Noah Holdings does not pay a dividend. BlackRock pays out 49.1% of its earnings in the form of a dividend. BlackRock has increased its dividend for 7 consecutive years.

Valuation and Earnings

This table compares Noah Holdings and BlackRock’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Noah Holdings $385.97 million 3.21 $112.69 million $1.67 18.80
BlackRock $11.35 billion 6.09 $5.01 billion $20.35 20.87

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

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Noah Holdings and BlackRock, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Noah Holdings 0 0 1 0 3.00
BlackRock 0 5 7 0 2.58

Noah Holdings presently has a consensus price target of $29.00, suggesting a potential downside of 7.64%. BlackRock has a consensus price target of $427.64, suggesting a potential upside of 0.71%. Given BlackRock’s higher possible upside, analysts plainly believe BlackRock is more favorable than Noah Holdings.

Insider & Institutional Ownership

42.4% of Noah Holdings shares are held by institutional investors. Comparatively, 80.9% of BlackRock shares are held by institutional investors. 1.9% of BlackRock shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Noah Holdings and BlackRock’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Noah Holdings 29.01% 19.37% 12.16%
BlackRock 29.74% 11.62% 1.50%

Summary

BlackRock beats Noah Holdings on 12 of the 17 factors compared between the two stocks.

Noah Holdings Company Profile

Noah Holdings Limited is a wealth management service provider with a focus on global wealth investment and asset allocation services for high net worth individuals and enterprises in China. The Company operates through three segments: wealth management, asset management and Internet finance. It also provides Internet finance services to clients in China. It provides direct access to China’s high net worth population. With approximately 1,100 relationship managers in over 130 branch offices, its coverage network includes China’s regions where high net worth population is concentrated, including the Yangtze River Delta, the Pearl River Delta, the Bohai Rim and other regions. Its product offerings consist primarily of over-the-counter (OTC) wealth management and OTC asset management products, mutual fund products and asset management plans originated in China and designed to cater to the needs of China’s high net worth population.

BlackRock Company Profile

BlackRock, Inc. (BlackRock) is an investment management company. BlackRock provides a range of investment and risk management services to institutional and retail clients worldwide. Its diverse platform of active (alpha) and index (beta) investment strategies across asset classes enables the Company to tailor investment outcomes and asset allocation solutions for clients. Its product offerings include single- and multi-asset portfolios investing in equities, fixed income, alternatives and money market instruments. Its products are offered directly and through intermediaries in a range of vehicles, including open-end and closed-end mutual funds, iShares exchange-traded funds (ETFs), separate accounts, collective investment funds and other pooled investment vehicles. It offers its Aladdin investment system, as well as risk management, outsourcing, advisory and technology services, to institutional investors and wealth management intermediaries under the BlackRock Solutions name.

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