Financial Analysis: ArrowMark Financial (NASDAQ:BANX) vs. ONEX (OTCMKTS:ONEXF)

ONEX (OTCMKTS:ONEXF) and ArrowMark Financial (NASDAQ:BANX) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, analyst recommendations, profitability, valuation, risk, institutional ownership and earnings.

Profitability

This table compares ONEX and ArrowMark Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ONEX	56.15%	5.11%	3.18%
ArrowMark Financial	N/A	N/A	N/A

Risk & Volatility

ONEX has a beta of 1.33, suggesting that its stock price is 33% more volatile than the S&P 500. Comparatively, ArrowMark Financial has a beta of 0.2, suggesting that its stock price is 80% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent recommendations and price targets for ONEX and ArrowMark Financial, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ONEX	0	1	2	0	2.67
ArrowMark Financial	0	0	0	0	0.00

Dividends

ONEX pays an annual dividend of $0.29 per share and has a dividend yield of 0.4%. ArrowMark Financial pays an annual dividend of $1.80 per share and has a dividend yield of 8.6%. ONEX pays out 4.7% of its earnings in the form of a dividend. ArrowMark Financial pays out 391.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Valuation & Earnings

This table compares ONEX and ArrowMark Financial”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ONEX	$649.00 million	8.11	$303.00 million	$6.21	12.36
ArrowMark Financial	N/A	N/A	N/A	$0.46	45.74

ONEX has higher revenue and earnings than ArrowMark Financial. ONEX is trading at a lower price-to-earnings ratio than ArrowMark Financial, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

0.7% of ONEX shares are held by institutional investors. Comparatively, 24.9% of ArrowMark Financial shares are held by institutional investors. 0.7% of ArrowMark Financial shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Summary

ONEX beats ArrowMark Financial on 9 of the 13 factors compared between the two stocks.

About ONEX

Onex Corporation is a private equity firm specializing in acquisitions and platform acquisitions. The firm makes investments in buyouts, large- middle market, large-cap, mid-cap, and small-cap market and distressed companies. It also invests in recapitalization, growth capital, corporate carve-outs of subsidiaries and mission-critical supply divisions from multinational corporations, operational restructurings of undervalued businesses, and builds up. The firm seeks to invest in technology, electronics manufacturing services, industrial, aerospace, healthcare, retail, restaurants, industrials products, customer care services, metal services, building products, entertainment, gaming, cabinetry products, commercial vehicles, commercial and investment banking, financial services, commercial and multi-unit residential real estate. It invests in global businesses headquartered in North America, including United States and Canada, or Europe. The firm seeks to invest between $125 million and $1 billion in companies that have minimum revenues of $300 million. It does not consider size if the company is in an industry in which the firm already has presence. The firm seeks to make direct as well as co-investments through managed private equity, real estate and credit funds. It seeks to acquire a control position in its portfolio companies. Onex Corporation was founded in 1984 and is based in Toronto, Canada with additional offices in New York, New York; Englewood Cliffs, New Jersey; Boston, Massachusetts and London, United Kingdom.

About ArrowMark Financial

ArrowMark Financial Corp. is a closed-end balanced mutual fund launched and managed by ArrowMark Asset Management, LLC. It invests in public equity and fixed income markets of global region. For its equity portion, the fund invests in stocks of companies operating across financials, banks sectors. It invests in growth and value stocks of companies across diversified market capitalization. For its fixed income portion, the fund invests in debt and subordinated debt, structured notes and securities, regulatory capital securities which are rated below investment grade. ArrowMark Financial Corp. was formed on February 7, 2013 and is domiciled in the United States.