B. Riley Financial (RILY) versus Ituran Location and Control Ltd. (US) (ITRN) Critical Comparison

B. Riley Financial (NASDAQ: RILY) and Ituran Location and Control Ltd. (US) (NASDAQ:ITRN) are both small-cap business services companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, risk, institutional ownership, valuation, dividends, analyst recommendations and earnings.

Dividends

B. Riley Financial pays an annual dividend of $0.32 per share and has a dividend yield of 1.7%. Ituran Location and Control Ltd. (US) pays an annual dividend of $0.96 per share and has a dividend yield of 2.8%. B. Riley Financial pays out 21.2% of its earnings in the form of a dividend. Ituran Location and Control Ltd. (US) pays out 49.2% 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.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for B. Riley Financial and Ituran Location and Control Ltd. (US), as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
B. Riley Financial 0 0 0 0 N/A
Ituran Location and Control Ltd. (US) 0 2 0 0 2.00

Ituran Location and Control Ltd. (US) has a consensus price target of $36.00, suggesting a potential upside of 5.73%. Given Ituran Location and Control Ltd. (US)’s higher possible upside, analysts plainly believe Ituran Location and Control Ltd. (US) is more favorable than B. Riley Financial.

Insider and Institutional Ownership

45.9% of B. Riley Financial shares are held by institutional investors. Comparatively, 53.1% of Ituran Location and Control Ltd. (US) shares are held by institutional investors. 30.9% of B. Riley Financial shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Risk & Volatility

B. Riley Financial has a beta of 0.95, indicating that its share price is 5% less volatile than the S&P 500. Comparatively, Ituran Location and Control Ltd. (US) has a beta of 0.79, indicating that its share price is 21% less volatile than the S&P 500.

Valuation & Earnings

This table compares B. Riley Financial and Ituran Location and Control Ltd. (US)’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
B. Riley Financial $190.35 million 2.61 $21.52 million $1.51 12.42
Ituran Location and Control Ltd. (US) $199.57 million 3.58 $32.13 million $1.95 17.46

Ituran Location and Control Ltd. (US) has higher revenue and earnings than B. Riley Financial. B. Riley Financial is trading at a lower price-to-earnings ratio than Ituran Location and Control Ltd. (US), indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares B. Riley Financial and Ituran Location and Control Ltd. (US)’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
B. Riley Financial 9.87% 17.98% 4.82%
Ituran Location and Control Ltd. (US) 18.99% 36.10% 22.09%

Summary

Ituran Location and Control Ltd. (US) beats B. Riley Financial on 11 of the 14 factors compared between the two stocks.

B. Riley Financial Company Profile

B. Riley Financial, Inc. is an independent investment bank. The Company’s segments include capital markets, auction and liquidation, valuation and appraisal, and Principal Investments-United Online. The capital markets segment provides an array of investment banking, corporate finance, research, wealth management, sales and trading services to corporate, institutional and high net worth clients. The auction and liquidation segment utilizes a scalable network of independent contractors and industry-specific advisors to tailor its services to the needs of a multitude of clients, logistical challenges and distressed circumstances. The valuation and appraisal segment provides valuation and appraisal services to financial institutions, lenders, private equity firms and other providers of capital. The principal investments-United Online segment consists of businesses, which has been acquired primarily for attractive investment return characteristics.

Ituran Location and Control Ltd. (US) Company Profile

Ituran Location and Control Ltd. is a provider of location-based services, consisting of stolen vehicle recovery (SVR), fleet management services and other tracking services. The Company also provides wireless communication products used in connection with its location-based services and various other applications. Its operations consist of two segments: location-based services and wireless communications products. Its location-based services segment consists of its SVR and tracking services, fleet management and value-added services consisted of personal locater services and concierge services. Its wireless communications products segment consists of short and medium range two-way machine-to-machine wireless communications products that are used for various applications, including automatic vehicle location (AVL) and automatic vehicle identification. It primarily provides its services, as well as sells and leases its products in Israel, Brazil, Argentina and the United States.

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