Head-To-Head Review: Merriman (MERR) vs. MarketAxess (MKTX)

Merriman (OTCMKTS:MERR) and MarketAxess (NASDAQ:MKTX) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, institutional ownership, risk, valuation, dividends, profitability and analyst recommendations.

Dividends

MarketAxess pays an annual dividend of $1.68 per share and has a dividend yield of 0.7%. Merriman does not pay a dividend. MarketAxess pays out 43.1% of its earnings in the form of a dividend. MarketAxess has raised its dividend for 7 consecutive years.

Profitability

This table compares Merriman and MarketAxess’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Merriman N/A N/A N/A
MarketAxess 37.97% 29.40% 26.42%

Institutional and Insider Ownership

99.3% of MarketAxess shares are owned by institutional investors. 63.0% of Merriman shares are owned by company insiders. Comparatively, 3.5% of MarketAxess shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares Merriman and MarketAxess’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Merriman N/A N/A N/A N/A N/A
MarketAxess $397.47 million 21.25 $148.08 million $3.90 57.62

MarketAxess has higher revenue and earnings than Merriman.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Merriman and MarketAxess, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Merriman 0 0 0 0 N/A
MarketAxess 1 8 0 0 1.89

MarketAxess has a consensus target price of $206.71, indicating a potential downside of 8.02%. Given MarketAxess’ higher possible upside, analysts plainly believe MarketAxess is more favorable than Merriman.

Risk and Volatility

Merriman has a beta of 3.09, indicating that its stock price is 209% more volatile than the S&P 500. Comparatively, MarketAxess has a beta of 0.09, indicating that its stock price is 91% less volatile than the S&P 500.

Summary

MarketAxess beats Merriman on 8 of the 11 factors compared between the two stocks.

Merriman Company Profile

Merriman Holdings, Inc., through its subsidiary, Merriman Capital, Inc., provides capital market advisory and research, corporate, and investment banking services primarily in the United States and Canada. The company's investment banking services include corporate financing services, such as initial public offerings, secondary offerings, and private placements services; and strategic advisory services comprise transaction-specific advice regarding mergers and acquisitions, divestitures, spin-offs, and privatizations, as well as general strategic advice. It also offers institutional brokerage services, including institutional sales trading and equity execution, and options execution services to institutional clients. In addition, the company executes securities transactions for money managers, mutual funds, hedge funds, insurance companies, and pension and profit-sharing plans; and provides integrated research and trading solutions, as well as capital markets advisory services. It primarily serves institutional investors and corporate clients. The company was formerly known as Merriman Curhan Ford Group, Inc. and changed its name to Merriman Holdings, Inc. in August 2010. Merriman Holdings, Inc. was founded in 1987 and is headquartered in San Francisco, California.

MarketAxess Company Profile

MarketAxess Holdings Inc., together with its subsidiaries, operates an electronic trading platform that enables fixed-income market participants to trade corporate bonds and other types of fixed-income instruments worldwide. It offers institutional investor and broker-dealer the access to global liquidity in U.S. high-grade corporate bonds, emerging markets and high-yield bonds, European bonds, U.S. agency bonds, municipal bonds, credit default swaps, and other fixed-income securities. The company, through its Open Trading protocol, executes trades in certain bonds between and among institutional investor and broker-dealer clients in an all-to-all trading environment on a matched principal basis. It also offers trading-related products and services, including market data to assist clients with trading decisions; connectivity solutions that facilitate straight-through processing; technology services to optimize trading environments; and execution services for exchange-traded fund managers and other clients. In addition, the company, through its Trax division, offers a range of pre-and post-trade services, including trade matching, trade publication, regulatory transaction reporting, and market and reference data across a range of fixed-income and other products. MarketAxess Holdings Inc. was founded in 2000 and is headquartered in New York, New York.

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