Reviewing T. Rowe Price Group (TROW) & Cohen & Steers (CNS)
T. Rowe Price Group (NASDAQ: TROW) and Cohen & Steers (NYSE:CNS) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, institutional ownership, valuation, profitability, earnings, analyst recommendations and dividends.
This table compares T. Rowe Price Group and Cohen & Steers’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|T. Rowe Price Group||32.64%||24.38%||18.94%|
|Cohen & Steers||26.34%||33.17%||26.42%|
Insider & Institutional Ownership
74.2% of T. Rowe Price Group shares are held by institutional investors. Comparatively, 45.4% of Cohen & Steers shares are held by institutional investors. 3.6% of T. Rowe Price Group shares are held by company insiders. Comparatively, 52.9% of Cohen & Steers shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
This is a summary of current ratings and price targets for T. Rowe Price Group and Cohen & Steers, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|T. Rowe Price Group||3||6||1||0||1.80|
|Cohen & Steers||1||2||1||0||2.00|
T. Rowe Price Group presently has a consensus target price of $82.13, suggesting a potential downside of 3.06%. Cohen & Steers has a consensus target price of $44.33, suggesting a potential upside of 18.06%. Given Cohen & Steers’ stronger consensus rating and higher probable upside, analysts clearly believe Cohen & Steers is more favorable than T. Rowe Price Group.
Valuation and Earnings
This table compares T. Rowe Price Group and Cohen & Steers’ gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|T. Rowe Price Group||$4.47 billion||4.56||$2.06 billion||$5.82||14.56|
|Cohen & Steers||$366.32 million||4.75||$150.50 million||$2.06||18.23|
T. Rowe Price Group has higher revenue and earnings than Cohen & Steers. T. Rowe Price Group is trading at a lower price-to-earnings ratio than Cohen & Steers, indicating that it is currently the more affordable of the two stocks.
T. Rowe Price Group pays an annual dividend of $2.28 per share and has a dividend yield of 2.7%. Cohen & Steers pays an annual dividend of $1.12 per share and has a dividend yield of 3.0%. T. Rowe Price Group pays out 39.2% of its earnings in the form of a dividend. Cohen & Steers pays out 54.4% 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. T. Rowe Price Group has increased its dividend for 5 consecutive years and Cohen & Steers has increased its dividend for 30 consecutive years. Cohen & Steers is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Risk and Volatility
T. Rowe Price Group has a beta of 1.24, meaning that its stock price is 24% more volatile than the S&P 500. Comparatively, Cohen & Steers has a beta of 1.55, meaning that its stock price is 55% more volatile than the S&P 500.
Cohen & Steers beats T. Rowe Price Group on 10 of the 16 factors compared between the two stocks.
T. Rowe Price Group Company Profile
T. Rowe Price Group, Inc. is a financial services holding company. The Company provides global investment management services through its subsidiaries to investors across the world. The Company provides an array of Company sponsored the United States mutual funds, other sponsored pooled investment vehicles, sub advisory services, separate account management, recordkeeping, and related services to individuals, advisors, institutions, financial intermediaries and retirement plan sponsors. The Company distributes its products in countries located within three geographical regions: North America, Europe Middle East and Africa (EMEA), and Asia Pacific (APAC). It also offers specialized advisory services, including management of stable value investment contracts and a distribution management service for the disposition of equity securities its clients receive from third-party venture capital investment pools. As of December 31, 2016, it serviced clients in 45 countries across the world.
Cohen & Steers Company Profile
Cohen & Steers, Inc. (CNS) is a holding company. The Company is an investment manager with a focus on liquid real assets, including real estate securities, listed infrastructure, commodities and natural resource equities, as well as preferred securities and other income solutions. The Company serves institutional and individual investors. The Company manages three types of investment vehicles: institutional accounts, open-end funds and closed-end funds. The Company also provides services in connection with model-based strategies (MBS) accounts. In addition, the Company provides several services in connection with assets held by unit investment trusts (UITs). As a portfolio consultant to a number of UITs, the Company constructs a portfolio of securities that suit the investment objective of the UIT. The Company also provides ongoing portfolio monitoring services and provides a license to certain firms to use its name in connection with certain of their investment products.
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