Critical Analysis: Janus Capital Group (JNS) vs. BlackRock (BLK)

Janus Capital Group (NYSE: JNS) and BlackRock (NYSE:BLK) are both mid-cap financials companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, profitability, analyst recommendations, institutional ownership, risk, valuation and dividends.

Valuation and Earnings

This table compares Janus Capital Group and BlackRock’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Janus Capital Group N/A N/A N/A $0.76 18.64
BlackRock $11.16 billion 7.38 $3.17 billion $21.36 24.05

BlackRock has higher revenue and earnings than Janus Capital Group. Janus Capital Group is trading at a lower price-to-earnings ratio than BlackRock, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

90.2% of Janus Capital Group shares are held by institutional investors. Comparatively, 83.5% of BlackRock shares are held by institutional investors. 2.1% of Janus Capital Group shares are held by insiders. Comparatively, 1.9% of BlackRock shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Janus Capital Group and BlackRock’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Janus Capital Group 12.54% 7.26% 4.48%
BlackRock 29.52% 12.01% 1.60%

Analyst Ratings

This is a summary of current recommendations and price targets for Janus Capital Group and BlackRock, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Janus Capital Group 1 1 0 0 1.50
BlackRock 0 3 8 0 2.73

Janus Capital Group presently has a consensus price target of $13.00, indicating a potential downside of 8.26%. BlackRock has a consensus price target of $488.00, indicating a potential downside of 5.00%. Given BlackRock’s stronger consensus rating and higher possible upside, analysts plainly believe BlackRock is more favorable than Janus Capital Group.

Dividends

Janus Capital Group pays an annual dividend of $0.44 per share and has a dividend yield of 3.1%. BlackRock pays an annual dividend of $10.00 per share and has a dividend yield of 1.9%. Janus Capital Group pays out 57.9% of its earnings in the form of a dividend. BlackRock pays out 46.8% 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. Janus Capital Group has raised its dividend for 7 consecutive years and BlackRock has raised its dividend for 6 consecutive years. Janus Capital Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

BlackRock beats Janus Capital Group on 9 of the 14 factors compared between the two stocks.

Janus Capital Group Company Profile

Janus Capital Group Inc. provides investment management, administration, distribution and related services to financial advisors, individuals and institutional clients through mutual funds, separate accounts, other pooled investment vehicles, exchange-traded products (ETPs) and subadvised relationships (collectively referred to as investment products) in both domestic and international markets. The Company operates through investment management business segment. The Company provides investment management solutions across a range of disciplines, including fundamental the United States and global equities (growth and value), mathematical equities, fixed income and alternatives. As of December 31, 2016, the Company’s investment products were distributed through three primary channels: intermediary, institutional and self-directed. Each distribution channel focuses on specific investor groups and the requirements of each group.

BlackRock Company Profile

BlackRock, Inc. (BlackRock) is an investment management company. BlackRock provides a range of investment and risk management services to institutional and retail clients worldwide. Its diverse platform of active (alpha) and index (beta) investment strategies across asset classes enables the Company to tailor investment outcomes and asset allocation solutions for clients. Its product offerings include single- and multi-asset portfolios investing in equities, fixed income, alternatives and money market instruments. Its products are offered directly and through intermediaries in a range of vehicles, including open-end and closed-end mutual funds, iShares exchange-traded funds (ETFs), separate accounts, collective investment funds and other pooled investment vehicles. It offers its Aladdin investment system, as well as risk management, outsourcing, advisory and technology services, to institutional investors and wealth management intermediaries under the BlackRock Solutions name.

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