Thomson Reuters Corp (NYSE: TRI) and TheStreet (NASDAQ:TST) are both business services companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, profitability, earnings, risk, dividends, valuation and analyst recommendations.

Dividends

Thomson Reuters Corp pays an annual dividend of $1.38 per share and has a dividend yield of 3.0%. TheStreet does not pay a dividend. Thomson Reuters Corp pays out 33.9% of its earnings in the form of a dividend. Thomson Reuters Corp has increased its dividend for 9 consecutive years.

Profitability

This table compares Thomson Reuters Corp and TheStreet’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Thomson Reuters Corp 26.81% 13.64% 6.42%
TheStreet -21.87% -1.30% -0.71%

Analyst Ratings

This is a breakdown of current recommendations and price targets for Thomson Reuters Corp and TheStreet, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Thomson Reuters Corp 1 6 5 0 2.33
TheStreet 0 0 2 0 3.00

Thomson Reuters Corp currently has a consensus price target of $50.30, indicating a potential upside of 9.80%. TheStreet has a consensus price target of $2.05, indicating a potential upside of 127.78%. Given TheStreet’s stronger consensus rating and higher possible upside, analysts clearly believe TheStreet is more favorable than Thomson Reuters Corp.

Insider and Institutional Ownership

26.2% of Thomson Reuters Corp shares are owned by institutional investors. Comparatively, 46.8% of TheStreet shares are owned by institutional investors. 9.7% of TheStreet shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Thomson Reuters Corp and TheStreet’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Thomson Reuters Corp $11.20 billion 2.92 $2.52 billion $4.07 11.26
TheStreet $62.38 million 0.52 $19,389.00 ($0.38) -2.37

Thomson Reuters Corp has higher revenue and earnings than TheStreet. TheStreet is trading at a lower price-to-earnings ratio than Thomson Reuters Corp, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Thomson Reuters Corp has a beta of 0.75, indicating that its stock price is 25% less volatile than the S&P 500. Comparatively, TheStreet has a beta of 0.7, indicating that its stock price is 30% less volatile than the S&P 500.

Summary

Thomson Reuters Corp beats TheStreet on 11 of the 16 factors compared between the two stocks.

About Thomson Reuters Corp

Thomson Reuters Corporation (Thomson Reuters) is a Canada-based provider of news and information for professional markets. The Company is organized in three business units: Financial & Risk, Legal, and Tax & Accounting. The Financial & Risk unit is a provider of critical news, information and analytics, enabling transactions and connecting communities of trading, investment, financial and corporate professionals. The Legal unit is a provider of critical online and print information, decision tools, software and services that support legal, investigation, business and government professionals around the world. The Tax & Accounting unit is a provider of integrated tax compliance and accounting information, software and services for professionals in accounting firms, corporations, law firms and government. The Company also operates Reuters, Global Growth Organization (GGO) and Enterprise Technology & Operations (ET&O). Thomson Reuters operates in over 100 countries.

About TheStreet

TheStreet, Inc. (TheStreet) is a digital financial media company focused on the financial, and mergers and acquisitions environment. The Company’s collection of digital services provides users, subscribers and advertisers with a range of content and tools through a range of online, social media, tablet and mobile channels. With a suite of digital services, TheStreet offers the tools and insights needed to make informed decisions about earning, investing, saving and spending money. TheStreet provides interactive multimedia coverage of the financial markets, economy, industry trends, investment and financial planning. Its subscription products are designed to address the needs of investors with various areas of interest, including fledgling investors, day and swing traders, and fundamental, technical and options traders. Its RateWatch business publishes bank rate market information on a subscription basis to financial institutions and government agencies.

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