China Finance Online (NYSE: GBL) and Gamco Investors (NYSE:GBL) are both small-cap computer and technology companies, but which is the better stock? We will compare the two businesses based on the strength of their analyst recommendations, profitability, earnings, dividends, valuation, risk and institutional ownership.

Volatility and Risk

China Finance Online has a beta of 2.18, suggesting that its stock price is 118% more volatile than the S&P 500. Comparatively, Gamco Investors has a beta of 1.13, suggesting that its stock price is 13% more volatile than the S&P 500.

Insider and Institutional Ownership

2.5% of China Finance Online shares are owned by institutional investors. Comparatively, 17.0% of Gamco Investors shares are owned by institutional investors. 30.4% of China Finance Online shares are owned by company insiders. Comparatively, 81.0% of Gamco Investors shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares China Finance Online and Gamco Investors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
China Finance Online -64.12% -57.44% -25.81%
Gamco Investors 24.59% -141.26% 72.93%

Earnings and Valuation

This table compares China Finance Online and Gamco Investors’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
China Finance Online $42.62 million 0.96 -$36.73 million N/A N/A
Gamco Investors $360.52 million 2.07 $77.80 million N/A N/A

Gamco Investors has higher revenue and earnings than China Finance Online.

Dividends

Gamco Investors pays an annual dividend of $0.08 per share and has a dividend yield of 0.3%. China Finance Online does not pay a dividend. Gamco Investors has increased its dividend for 6 consecutive years.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for China Finance Online and Gamco Investors, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
China Finance Online 0 0 0 0 N/A
Gamco Investors 0 0 0 0 N/A

Summary

Gamco Investors beats China Finance Online on 9 of the 11 factors compared between the two stocks.

About China Finance Online

China Finance Online Co. Limited provides Web-based financial services in the People's Republic of China and Hong Kong. The company operates through three segments: Commodities Brokerage Services; Online Financial Information and Advisory Service, and Other Related Services; and Hong Kong Brokerage Services. It provides online access to securities and commodities trading services, wealth management products, and securities investment advisory services to retail investors; and financial database and analytics to institutional investors, including financial, research, academic, and regulatory institutions, as well as financial software products. The company is involved in the operation of Yinglibao, an Internet-based financial platform that integrates wealth management solutions and mutual fund distribution; JRJ mobile app for financial information, securities trading, investment advisory, and wealth management; jrj.com.cn to provide access for wealth management solutions and mutual fund distribution; and jrj.com, a financial information Website. In addition, it provides commodities brokerage services; securities and futures contracts brokerage and related services to its customers, who invest in stocks listed on Hong Kong Stock Exchanges and Clearing Limited; information services; and insurance brokerage services. The company offers its products and services to individual investors managing their own money; professional investors, such as institutional investors managing large sums of money on behalf of their clients and high net worth individuals; and other financial professionals, including investment bankers, stock analysts and financial reporters, and middle class individuals. The company was incorporated in 1998 and is based in Beijing, the People's Republic of China.

About Gamco Investors

GAMCO Investors, Inc. is a publicly owned holding investment manager. The firm also provides wealth management, investment advisory, institutional research, brokerage, dealer, underwriting, and distribution services to its clients. It provides its services to individuals including high net worth individuals, corporate pension and profit-sharing plans, foundations, endowments, jointly trust plans, municipalities, and investment companies. The firm, through its subsidiaries, manages separate client-focused equity, fixed income, and balanced portfolios. It also launches equity, fixed income, and balanced mutual funds and manages equity mutual funds for its clients. Through its subsidiaries, the firm invests in the public equity and fixed income markets across the globe. It invests in value stocks of companies. The firm employs fundamental analysis with a focus on bottom-up stock picking approach to create its portfolios. It conducts in-house research to make its investments. The firm was founded in 1976 and is based in Rye, New York with additional offices in Greenwich, Connecticut; Bannockburn, Illinois; and Tokyo, Japan. GAMCO Investors, Inc. operates as a subsidiary of GGCP, Inc.

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