T. Rowe Price Group (NASDAQ:TROW – Get Free Report) and TPG (NASDAQ:TPG – Get Free Report) are both large-cap finance companies, but which is the better stock? We will compare the two companies based on the strength of their analyst recommendations, institutional ownership, valuation, profitability, dividends, risk and earnings.
Risk & Volatility
T. Rowe Price Group has a beta of 1.47, meaning that its stock price is 47% more volatile than the S&P 500. Comparatively, TPG has a beta of 1.56, meaning that its stock price is 56% more volatile than the S&P 500.
Dividends
T. Rowe Price Group pays an annual dividend of $5.08 per share and has a dividend yield of 4.7%. TPG pays an annual dividend of $2.36 per share and has a dividend yield of 3.9%. T. Rowe Price Group pays out 56.8% of its earnings in the form of a dividend. TPG pays out -1,242.1% 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. T. Rowe Price Group has raised its dividend for 39 consecutive years. T. Rowe Price Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Profitability
| Net Margins | Return on Equity | Return on Assets | |
| T. Rowe Price Group | 28.72% | 19.77% | 15.04% |
| TPG | 1.60% | 25.79% | 8.16% |
Earnings and Valuation
This table compares T. Rowe Price Group and TPG”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| T. Rowe Price Group | $7.09 billion | 3.33 | $2.10 billion | $8.95 | 12.02 |
| TPG | $2.73 billion | 8.37 | $23.48 million | ($0.19) | -317.63 |
T. Rowe Price Group has higher revenue and earnings than TPG. TPG is trading at a lower price-to-earnings ratio than T. Rowe Price Group, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
73.4% of T. Rowe Price Group shares are owned by institutional investors. Comparatively, 94.0% of TPG shares are owned by institutional investors. 2.0% of T. Rowe Price Group shares are owned by insiders. Comparatively, 70.0% of TPG shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
Analyst Ratings
This is a breakdown of current ratings and target prices for T. Rowe Price Group and TPG, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| T. Rowe Price Group | 4 | 8 | 0 | 0 | 1.67 |
| TPG | 0 | 7 | 8 | 1 | 2.63 |
T. Rowe Price Group currently has a consensus price target of $101.09, suggesting a potential downside of 6.07%. TPG has a consensus price target of $62.57, suggesting a potential upside of 3.68%. Given TPG’s stronger consensus rating and higher probable upside, analysts plainly believe TPG is more favorable than T. Rowe Price Group.
Summary
TPG beats T. Rowe Price Group on 10 of the 18 factors compared between the two stocks.
About T. Rowe Price Group
T. Rowe Price Group, Inc. is a publicly owned investment manager. The firm provides its services to individuals, institutional investors, retirement plans, financial intermediaries, and institutions. It launches and manages equity and fixed income mutual funds. The firm invests in the public equity and fixed income markets across the globe. It employs fundamental and quantitative analysis with a bottom-up approach. The firm utilizes in-house and external research to make its investments. It employs socially responsible investing with a focus on environmental, social, and governance issues. It makes investment in late-stage venture capital transactions and usually invests between $3 million and $5 million. The firm was previously known as T. Rowe Group, Inc. and T. Rowe Price Associates, Inc. T. Rowe Price Group, Inc. was founded in 1937 and is based in Baltimore, Maryland, with additional offices in Colorado Springs, Colorado; Owings Mills, Maryland; San Francisco, California; New York, New York; Philadelphia, Pennsylvania; Tampa, Florida; Toronto, Ontario; Hellerup, Denmark; Amsterdam, The Netherlands; Luxembourg, Grand Duchy of Luxembourg; Zurich, Switzerland; Dubai, United Arab Emirates; London, United Kingdom; Sydney, New South Wales; Hong Kong; Tokyo, Japan; Singapore; Frankfurt, Shanghai, China; Germany, Madrid, Spain, Milan, Italy, Stockholm, Sweden, Melbourne, Australia, Amsterdam, Netherlands and Washington, DC.
About TPG
TPG Inc. operates as an alternative asset manager in the United States and internationally. The company offers investment management services to TPG Funds, limited partners, and other vehicles. It also offers monitoring services to portfolio companies; advisory, debt and equity arrangement, and underwriting and placement services; and capital structuring and other advisory services to portfolio companies. In addition, the company invests in private equity funds, real estate funds, hedge funds, and credit funds. TPG Inc. was founded in 1992 and is based in Fort Worth, Texas. The company operates as a subsidiary of TPG GP A, LLC.
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