Daiwa Securities Group (OTCMKTS:DSEEY – Get Free Report) and NMI (NASDAQ:NMIH – Get Free Report) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, risk, dividends, analyst recommendations, profitability, earnings and valuation.
Risk & Volatility
Daiwa Securities Group has a beta of 0.59, meaning that its stock price is 41% less volatile than the S&P 500. Comparatively, NMI has a beta of 0.52, meaning that its stock price is 48% less volatile than the S&P 500.
Analyst Recommendations
This is a summary of recent ratings and recommmendations for Daiwa Securities Group and NMI, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Daiwa Securities Group | 0 | 1 | 0 | 0 | 2.00 |
| NMI | 0 | 3 | 5 | 0 | 2.62 |
NMI has a consensus target price of $47.88, suggesting a potential upside of 22.60%. Given NMI’s stronger consensus rating and higher possible upside, analysts plainly believe NMI is more favorable than Daiwa Securities Group.
Earnings and Valuation
This table compares Daiwa Securities Group and NMI”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Daiwa Securities Group | $9.75 billion | 1.64 | $1.16 billion | $0.93 | 12.14 |
| NMI | $706.44 million | 4.12 | $388.93 million | $5.09 | 7.67 |
Daiwa Securities Group has higher revenue and earnings than NMI. NMI is trading at a lower price-to-earnings ratio than Daiwa Securities Group, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Daiwa Securities Group and NMI’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Daiwa Securities Group | 12.51% | 9.31% | 0.49% |
| NMI | 53.11% | 14.78% | 9.98% |
Institutional & Insider Ownership
94.1% of NMI shares are held by institutional investors. 2.4% of NMI shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Summary
NMI beats Daiwa Securities Group on 10 of the 14 factors compared between the two stocks.
About Daiwa Securities Group
Daiwa Securities Group Inc. is a Japan-based financial services holding company whose principal business is securities and investment services. Its offerings include brokerage and investment advice for individual and corporate clients, as well as services for institutional investors. The group’s businesses also include investment banking, such as securities underwriting and financial advisory services, along with asset management and investment activities. It serves clients in Japan and through operations in international markets.
About NMI
NMI Holdings, Inc. provides private mortgage insurance through its subsidiary, National Mortgage Insurance Corporation. Its coverage helps lenders manage the risk of mortgage loans made to borrowers who have smaller down payments, while enabling borrowers to qualify for home financing without a 20% down payment. The company offers mortgage insurance products and related services to mortgage lenders, banks, credit unions and other housing-market participants. Its offerings include borrower-paid and lender-paid coverage, along with technology and services that support mortgage insurance underwriting and policy management.
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