Patria Investments (NYSE:PAX) versus WisdomTree (NYSE:WT) Critical Review

Patria Investments (NYSE:PAX) and WisdomTree (NYSE:WT) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their earnings, institutional ownership, dividends, valuation, analyst recommendations, profitability and risk.

Insider and Institutional Ownership

96.3% of Patria Investments shares are held by institutional investors. Comparatively, 78.6% of WisdomTree shares are held by institutional investors. 58.1% of Patria Investments shares are held by insiders. Comparatively, 10.1% of WisdomTree shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Dividends

Patria Investments pays an annual dividend of $0.65 per share and has a dividend yield of 6.9%. WisdomTree pays an annual dividend of $0.12 per share and has a dividend yield of 0.6%. Patria Investments pays out 147.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. WisdomTree pays out 23.1% of its earnings in the form of a dividend.

Volatility and Risk

Patria Investments has a beta of 0.8, indicating that its share price is 20% less volatile than the S&P 500. Comparatively, WisdomTree has a beta of 1.18, indicating that its share price is 18% more volatile than the S&P 500.

Profitability

This table compares Patria Investments and WisdomTree’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Patria Investments	19.91%	38.68%	15.84%
WisdomTree	16.64%	40.93%	10.89%

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Patria Investments and WisdomTree, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Patria Investments	3	1	1	0	1.60
WisdomTree	0	3	5	0	2.62

Patria Investments presently has a consensus target price of $12.75, suggesting a potential upside of 35.28%. WisdomTree has a consensus target price of $25.72, suggesting a potential upside of 26.47%. Given Patria Investments’ higher possible upside, equities analysts clearly believe Patria Investments is more favorable than WisdomTree.

Earnings & Valuation

This table compares Patria Investments and WisdomTree”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Patria Investments	$428.00 million	1.46	$73.40 million	$0.44	21.42
WisdomTree	$493.75 million	6.24	$109.13 million	$0.52	39.10

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

Summary

WisdomTree beats Patria Investments on 10 of the 16 factors compared between the two stocks.

About Patria Investments

Patria Investments Limited operates as a private market investment firm focused on investing in Latin America. The company offers asset management services to investors focusing on private equity funds, infrastructure development funds, co-investments funds, constructivist equity funds, and real estate and credit funds. Patria Investments Limited was founded in 1994 and is headquartered in Grand Cayman, the Cayman Islands.

About WisdomTree

WisdomTree, Inc., through its subsidiaries, operates as an exchange-traded funds (ETFs) sponsor and asset manager. It offers ETFs in equities, currency, fixed income, and alternatives asset classes. The company also licenses its indexes to third parties for proprietary products, as well as offers a platform to promote the use of WisdomTree ETFs in 401(k) plans. It develops index using its fundamentally weighted index methodology. In addition, the company provides investment advisory services. The company was founded in 1985 and is based in New York, New York.