Hamilton Lane (NASDAQ: HLNE) and Financial Engines (NASDAQ:FNGN) are both small-cap finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, profitability, institutional ownership, dividends, earnings, valuation and risk.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Hamilton Lane and Financial Engines, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Hamilton Lane 0 3 2 0 2.40
Financial Engines 0 0 5 0 3.00

Hamilton Lane currently has a consensus price target of $21.25, indicating a potential downside of 5.76%. Financial Engines has a consensus price target of $43.00, indicating a potential upside of 36.94%. Given Financial Engines’ stronger consensus rating and higher possible upside, analysts plainly believe Financial Engines is more favorable than Hamilton Lane.

Institutional and Insider Ownership

66.7% of Hamilton Lane shares are held by institutional investors. 62.9% of Hamilton Lane shares are held by insiders. Comparatively, 16.0% of Financial Engines shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares Hamilton Lane and Financial Engines’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Hamilton Lane N/A N/A N/A
Financial Engines 8.98% 7.31% 6.64%

Valuation and Earnings

This table compares Hamilton Lane and Financial Engines’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Hamilton Lane $192.96 million 2.25 $87.34 million N/A N/A
Financial Engines $458.22 million 4.33 $84.14 million $0.64 49.06

Hamilton Lane has higher revenue, but lower earnings than Financial Engines.

Dividends

Hamilton Lane pays an annual dividend of $0.70 per share and has a dividend yield of 3.1%. Financial Engines pays an annual dividend of $0.28 per share and has a dividend yield of 0.9%. Financial Engines pays out 43.8% of its earnings in the form of a dividend.

Summary

Financial Engines beats Hamilton Lane on 8 of the 13 factors compared between the two stocks.

Hamilton Lane Company Profile

Hamilton Lane Incorporated is a global private markets investment solutions provider. The Company works with its clients to conceive, structure, build out, manage and monitor portfolios of private markets funds and direct investments, and it helps them access a set of such investment opportunities around the world. It offers a range of investment solutions across a range of private markets, including private equity, private credit, real estate, infrastructure, natural resources, growth equity and venture capital. These solutions are constructed from a range of investment types, including primary investments in funds managed by third-party managers, direct/co-investments alongside such funds and acquisitions of secondary stakes in such funds, with a range of its clients utilizing multiple investment types. These solutions are offered in a range of formats covering some or all phases of private markets investment programs, such as Customized Separate Accounts and Specialized Funds.

Financial Engines Company Profile

Financial Engines, Inc. is a provider of independent, technology-enabled financial advisory services, discretionary portfolio management, personalized investment advice, financial and retirement income planning, and financial education and guidance. The Company offers personalized plans for saving, investing, and generating retirement income, as well as by providing assessments of retirement income needs and readiness. The Company’s advice and planning services cover employer-sponsored defined contribution (DC) accounts (401(k), 457, and 403(b) plans), individual retirement account (IRA) accounts, and taxable accounts. For individuals, the Company provides discretionary portfolio management, personalized investment advice, financial and retirement income planning, financial education and guidance. The Company maintains two types of relationships with individuals: DC plan participants in the workplace and Individuals outside the workplace.

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