Head-To-Head Analysis: Freedom (NASDAQ:FRHC) & Guild (NYSE:GHLD)

Guild (NYSE:GHLD) and Freedom (NASDAQ:FRHC) are both finance 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.

Institutional & Insider Ownership

17.5% of Guild shares are held by institutional investors. Comparatively, 1.3% of Freedom shares are held by institutional investors. 78.3% of Guild shares are held by company insiders. Comparatively, 70.4% of Freedom shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Guild and Freedom, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Guild	0	5	2	0	2.29
Freedom	0	0	0	0	0.00

Guild currently has a consensus price target of $16.50, suggesting a potential downside of 16.52%. Given Guild’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Guild is more favorable than Freedom.

Risk and Volatility

Guild has a beta of 0.81, suggesting that its stock price is 19% less volatile than the S&P 500. Comparatively, Freedom has a beta of 1.16, suggesting that its stock price is 16% more volatile than the S&P 500.

Valuation and Earnings

This table compares Guild and Freedom”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Guild	$1.05 billion	1.17	$97.13 million	$0.69	28.64
Freedom	$2.05 billion	3.95	$84.65 million	$1.39	99.49

Guild has higher earnings, but lower revenue than Freedom. Guild is trading at a lower price-to-earnings ratio than Freedom, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Guild and Freedom’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Guild	4.40%	7.91%	2.06%
Freedom	4.13%	6.92%	0.93%

Summary

Guild beats Freedom on 9 of the 14 factors compared between the two stocks.

About Guild

Guild Holdings Company originates, sells, and services residential mortgage loans in the United States. It operates in two segments, Origination and Servicing. The company offers residential mortgages through retail and correspondent channels. Guild Holdings Company was incorporated in 1960 and is headquartered in San Diego, California.

About Freedom

Freedom Holding Corp., through its subsidiaries, provides securities brokerage, securities dealing, market making, investment research, investment counseling, and investment banking services. It offers retail brokerage services for exchange-traded and over-the-counter corporate equity and debt securities, money market instruments, exchange traded options and futures contracts, government bonds, and mutual funds; securities trading; underwriting services; margin lending services collateralized by securities and cash in the customer’s account; various investment education and training courses; investment research services; and commercial banking services, including payment cards, digital mortgages, and digital business and digital auto loans, as well as Freedom Box, a package of payment acquiring services. The company also provides capital raising solutions for corporate clients through initial public offerings and follow-on offerings; and debt capital markets solutions that focuses on structuring and distributing private and public debt for various purposes, including buyouts, acquisitions, growth capital financings, and recapitalizations, as well as information processing services. In addition, it facilitates repurchase and reverse repurchase agreements in proprietary trading activities; and covers short positions and settle other securities obligations to accommodate customers’ needs and finance its inventory positions. Further, the company offers proprietary trading and investment services, as well as insurance products; and Tradernet software platform for client margin risk evaluation and middle office security transfer requests. It operates in Central Asia, Eastern Europe, rest of Europe, the United States, Russia, the Middle East, and Caucasus. The company was formerly known as BMB Munai, Inc. and changed its name to Freedom Holding Corp. Freedom Holding Corp. was incorporated in 1981 and is headquartered in Almaty, Kazakhstan.