Critical Contrast: Deutsche Boerse (OTCMKTS:DBOEY) and S&P Global (NYSE:SPGI)

Deutsche Boerse (OTCMKTS:DBOEY) and S&P Global (NYSE:SPGI) are both large-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, valuation, earnings, profitability, analyst recommendations, dividends and institutional ownership.

Insider and Institutional Ownership

87.2% of S&P Global shares are held by institutional investors. 0.1% of S&P Global shares are held by company 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 Deutsche Boerse and S&P Global’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Deutsche Boerse	28.89%	19.29%	0.84%
S&P Global	27.27%	14.68%	8.26%

Earnings & Valuation

This table compares Deutsche Boerse and S&P Global”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Deutsche Boerse	$7.63 billion	8.03	$2.11 billion	$1.15	28.29
S&P Global	$14.21 billion	11.19	$3.85 billion	$12.73	40.71

S&P Global has higher revenue and earnings than Deutsche Boerse. Deutsche Boerse is trading at a lower price-to-earnings ratio than S&P Global, indicating that it is currently the more affordable of the two stocks.

Dividends

Deutsche Boerse pays an annual dividend of $0.26 per share and has a dividend yield of 0.8%. S&P Global pays an annual dividend of $3.84 per share and has a dividend yield of 0.7%. Deutsche Boerse pays out 22.6% of its earnings in the form of a dividend. S&P Global pays out 30.2% 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. S&P Global has raised its dividend for 53 consecutive years. Deutsche Boerse is clearly the better dividend stock, given its higher yield and lower payout ratio.

Volatility and Risk

Deutsche Boerse has a beta of 0.68, indicating that its stock price is 32% less volatile than the S&P 500. Comparatively, S&P Global has a beta of 1.2, indicating that its stock price is 20% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Deutsche Boerse and S&P Global, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Deutsche Boerse	0	3	0	0	2.00
S&P Global	0	1	14	1	3.00

S&P Global has a consensus target price of $592.71, indicating a potential upside of 14.37%. Given S&P Global’s stronger consensus rating and higher possible upside, analysts clearly believe S&P Global is more favorable than Deutsche Boerse.

Summary

S&P Global beats Deutsche Boerse on 14 of the 18 factors compared between the two stocks.

About Deutsche Boerse

Deutsche Börse AG operates as an exchange organization in Europe, America, and the Asia-Pacific. The company operates through four segments: Data & Analytics; Trading & Clearing; Fund Services; and Securities Services. It engages in the trading of derivatives, electricity and gas products, emission rights, foreign exchange, and commodity products; operating EEX and 360T over the counter trading platform for financial instruments, such as foreign exchange, money market, and interest rate products; and operating as a central counterparty. The company also operates in the cash market through Xetra, Börse Frankfurt, and Tradegate trading venues; Qontigo, an integrated suite of front-to-back investment management solution; and a central counterparty for equities and bonds, as well as provides pre-ipo and listing services. In addition, it offers custody and settlement services for securities; investment fund services; connectivity services; and global securities funding and financing, and collateral and liquidity management, as well as secured money, market transaction, and repos and securities lending transaction services. Further, the company provides order routing, settlement, asset management, and custody; investment distribution and placement; infrastructure and post-trading; index, analytics, and risk; securities transactions settlement; securities custody and administration; and market data and analytics services. Additionally, it operates third clearing house Nodal Clear; and specialized software as a service platform for trading participants and digital business platform, as well as offers information technology solutions, including financial market, commodities market, and network connectivity solutions under the Deutsche Börse and 7 Market Technology brands. The company was founded in 1585 and is headquartered in Eschborn, Germany.

About S&P Global

S&P Global, Inc. engages in the provision of transparent and independent ratings, benchmarks, analytics, and data to the capital and commodity markets worldwide. It operates through the following segments: Market Intelligence, Ratings, Commodity Insights, Mobility, Indices, and Engineering Solutions. The Market Intelligence segment provides multi-asset-class data and analytics integrated with purpose-built workflow solutions. The Ratings segment is involved in credit ratings, research, and analytics, offering investors and other market participants information, ratings, and benchmarks. The Commodity Insights segment focuses on information and benchmark prices for the commodity and energy markets. The Mobility segment offers solutions serving the full automotive value chain including vehicle manufacturers, automotive suppliers, mobility service providers, retailers, consumers, and finance and insurance companies. The Engineering Solutions segment engages in advanced knowledge discovery technologies, research tools, and software-based engineering decision engines to advance innovation, maximize productivity, improve quality, and reduce risk. The company was founded by James H. McGraw and John A. Hill in 1917 and is headquartered in New York, NY.