Moody’s (NYSE:MCO) vs. Blackstone (NYSE:BX) Head to Head Analysis

Blackstone (NYSE:BX) and Moody’s (NYSE:MCO) are both large-cap finance companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, profitability, dividends, valuation and risk.

Risk & Volatility

Blackstone has a beta of 1.56, indicating that its share price is 56% more volatile than the S&P 500. Comparatively, Moody’s has a beta of 1.34, indicating that its share price is 34% more volatile than the S&P 500.

Institutional and Insider Ownership

70.0% of Blackstone shares are owned by institutional investors. Comparatively, 92.1% of Moody’s shares are owned by institutional investors. 1.0% of Blackstone shares are owned by company insiders. Comparatively, 0.1% of Moody’s shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Blackstone and Moody’s’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Blackstone	21.84%	23.77%	10.06%
Moody’s	34.25%	80.35%	19.38%

Dividends

Blackstone pays an annual dividend of $5.16 per share and has a dividend yield of 3.8%. Moody’s pays an annual dividend of $4.12 per share and has a dividend yield of 0.8%. Blackstone pays out 115.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Moody’s pays out 26.1% of its earnings in the form of a dividend. Moody’s has raised its dividend for 16 consecutive years.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Blackstone and Moody’s, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Blackstone	0	11	13	0	2.54
Moody’s	0	5	14	1	2.80

Blackstone currently has a consensus target price of $149.43, suggesting a potential upside of 9.82%. Moody’s has a consensus target price of $553.61, suggesting a potential upside of 12.24%. Given Moody’s’ stronger consensus rating and higher possible upside, analysts clearly believe Moody’s is more favorable than Blackstone.

Valuation & Earnings

This table compares Blackstone and Moody’s”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Blackstone	$14.45 billion	7.07	$3.02 billion	$4.47	30.44
Moody’s	$7.72 billion	11.07	$2.46 billion	$15.77	31.28

Blackstone has higher revenue and earnings than Moody’s. Blackstone is trading at a lower price-to-earnings ratio than Moody’s, indicating that it is currently the more affordable of the two stocks.

Summary

Moody’s beats Blackstone on 13 of the 18 factors compared between the two stocks.

About Blackstone

Blackstone Inc. is an alternative asset management firm specializing in real estate, private equity, hedge fund solutions, credit, secondary funds of funds, public debt and equity and multi-asset class strategies. The firm typically invests in early-stage companies. It also provide capital markets services. The real estate segment specializes in opportunistic, core+ investments as well as debt investment opportunities collateralized by commercial real estate, and stabilized income-oriented commercial real estate across North America, Europe and Asia. The firm's corporate private equity business pursues transactions throughout the world across a variety of transaction types, including large buyouts,special situations, distressed mortgage loans, mid-cap buyouts, buy and build platforms, which involves multiple acquisitions behind a single management team and platform, and growth equity/development projects involving significant majority stakes in portfolio companies and minority investments in operating companies, shipping, real estate, corporate or consumer loans, and alternative energy greenfield development projects in energy and power, property, dislocated markets, shipping opportunities, financial institution breakups, re-insurance, and improving freight mobility, financial services, healthcare, life sciences, infrastructure, enterprise tech and consumer, as well as consumer technologies. The firm considers investment in Asia and Latin America. It seeks to invest between $0.25 million and $900 million per transaction. It invests in companies with enterprise value between $500 million and $5000 million. It has a three year investment period. Its hedge fund business manages a broad range of commingled and customized fund solutions and its credit business focuses on loans, and securities of non-investment grade companies spread across the capital structure including senior debt, subordinated debt, preferred stock and common equity. Blackstone Inc. was founded in 1985 and is headquartered in New York, New York with additional offices across Asia, Europe, North America and Central America.

About Moody’s

Moody’s Corporation operates as an integrated risk assessment firm worldwide. It operates in two segments, Moody’s Analytics and Moody’s Investors Services. The Moody’s Analytics segment develops a range of products and services that support the risk management activities of institutional participants in financial markets. It also offers credit research, credit models and analytics, economics data and models, and structured finance solutions; data sets on companies and securities; and SaaS solutions supporting banking, insurance, and know your customer workflows. The Moody’s Investors Service segment publishes credit ratings and provides assessment services on various debt obligations, programs and facilities, and entities that issue such obligations, such as various corporate, financial institution, and governmental obligations, as well as structured finance securities. The company was formerly known as Dun and Bradstreet Company and changed its name to Moody’s Corporation in September 2000. Moody’s Corporation was founded in 1900 and is headquartered in New York, New York.