Goldman Sachs Group, Inc. (The) (NYSE: GS) and Nomura Holdings Inc ADR (NYSE:NMR) are both large-cap finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, valuation, earnings, analyst recommendations, institutional ownership, profitability and risk.

Insider and Institutional Ownership

73.4% of Goldman Sachs Group, Inc. (The) shares are held by institutional investors. Comparatively, 0.6% of Nomura Holdings Inc ADR shares are held by institutional investors. 2.6% of Goldman Sachs Group, Inc. (The) shares are held by 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.

Risk & Volatility

Goldman Sachs Group, Inc. (The) has a beta of 1.42, indicating that its share price is 42% more volatile than the S&P 500. Comparatively, Nomura Holdings Inc ADR has a beta of 1.59, indicating that its share price is 59% more volatile than the S&P 500.

Dividends

Goldman Sachs Group, Inc. (The) pays an annual dividend of $3.00 per share and has a dividend yield of 1.3%. Nomura Holdings Inc ADR pays an annual dividend of $0.07 per share and has a dividend yield of 1.3%. Goldman Sachs Group, Inc. (The) pays out 15.7% of its earnings in the form of a dividend. Nomura Holdings Inc ADR pays out 11.1% 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. Goldman Sachs Group, Inc. (The) has increased its dividend for 5 consecutive years. Goldman Sachs Group, Inc. (The) is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Goldman Sachs Group, Inc. (The) and Nomura Holdings Inc ADR’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Goldman Sachs Group, Inc. (The) 26.44% 11.27% 0.96%
Nomura Holdings Inc ADR 15.47% 8.69% 0.57%

Analyst Recommendations

This is a breakdown of current ratings and price targets for Goldman Sachs Group, Inc. (The) and Nomura Holdings Inc ADR, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Goldman Sachs Group, Inc. (The) 1 14 11 0 2.38
Nomura Holdings Inc ADR 0 2 1 0 2.33

Goldman Sachs Group, Inc. (The) currently has a consensus price target of $237.61, suggesting a potential upside of 4.88%. Given Goldman Sachs Group, Inc. (The)’s stronger consensus rating and higher probable upside, research analysts clearly believe Goldman Sachs Group, Inc. (The) is more favorable than Nomura Holdings Inc ADR.

Earnings and Valuation

This table compares Goldman Sachs Group, Inc. (The) and Nomura Holdings Inc ADR’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Goldman Sachs Group, Inc. (The) $32.25 billion 2.72 $7.37 billion $19.06 11.89
Nomura Holdings Inc ADR $13.05 billion 1.50 $2.23 billion $0.63 8.76

Goldman Sachs Group, Inc. (The) has higher revenue and earnings than Nomura Holdings Inc ADR. Nomura Holdings Inc ADR is trading at a lower price-to-earnings ratio than Goldman Sachs Group, Inc. (The), indicating that it is currently the more affordable of the two stocks.

Summary

Goldman Sachs Group, Inc. (The) beats Nomura Holdings Inc ADR on 15 of the 17 factors compared between the two stocks.

About Goldman Sachs Group, Inc. (The)

The Goldman Sachs Group, Inc. is an investment banking, securities and investment management company that provides a range of financial services to corporations, financial institutions, governments and individuals. The Company operates in four business segments: Investment Banking, Institutional Client Services, Investing & Lending, and Investment Management. The Investment Banking segment consists of financial advisory and underwriting. The Institutional Client Services segment makes markets and facilitates client transactions in fixed income, equity, currency and commodity products. The investing and lending activities, which are typically longer-term, include its investing and relationship lending activities across various asset classes, primarily debt securities and loans, public and private equity securities, infrastructure and real estate. The Investment Management segment provides investment and wealth advisory services. As of December 2016, it had offices in over 30 countries.

About Nomura Holdings Inc ADR

Nomura Holdings, Inc. (Nomura) is a financial services company. The Company, through its broker-dealer, banking and other financial services subsidiaries, provide investment, financing and related services to individual, institutional and government clients across the world. The Company’s segments include Retail, Asset Management and Wholesale. Its clients include individuals, corporations, financial institutions, governments and governmental agencies. The Company’s Retail segment provides investment consultation services to individual clients in Japan. The Company’s Asset Management segment develops and manages investment trusts, and provides investment advisory services. The Company’s Wholesale segment is engaged in the sales and trading of debt and equity securities, derivatives, and currencies on a global basis, and provides investment banking services, such as the underwriting of debt and equity securities, as well as mergers and acquisitions and financial advice.

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