Head-To-Head Comparison: Diamond Hill Investment Group (NASDAQ:DHIL) and Patria Investments (NYSE:PAX)

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

Insider and Institutional Ownership

65.5% of Diamond Hill Investment Group shares are owned by institutional investors. Comparatively, 96.3% of Patria Investments shares are owned by institutional investors. 4.8% of Diamond Hill Investment Group shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

This table compares Diamond Hill Investment Group and Patria Investments’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Diamond Hill Investment Group	30.89%	18.46%	12.61%
Patria Investments	36.81%	38.20%	19.57%

Volatility and Risk

Diamond Hill Investment Group has a beta of 0.97, suggesting that its share price is 3% less volatile than the S&P 500. Comparatively, Patria Investments has a beta of 0.6, suggesting that its share price is 40% less volatile than the S&P 500.

Dividends

Diamond Hill Investment Group pays an annual dividend of $6.00 per share and has a dividend yield of 4.0%. Patria Investments pays an annual dividend of $1.60 per share and has a dividend yield of 11.3%. Diamond Hill Investment Group pays out 41.8% of its earnings in the form of a dividend. Patria Investments pays out 197.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Patria Investments has raised its dividend for 1 consecutive years. Patria Investments is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Diamond Hill Investment Group and Patria Investments, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Diamond Hill Investment Group	0	0	0	0	N/A
Patria Investments	0	0	0	0	N/A

Patria Investments has a consensus price target of $17.00, suggesting a potential upside of 20.31%. Given Patria Investments’ higher possible upside, analysts clearly believe Patria Investments is more favorable than Diamond Hill Investment Group.

Valuation & Earnings

This table compares Diamond Hill Investment Group and Patria Investments’ top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Diamond Hill Investment Group	$136.72 million	3.14	$42.23 million	$14.34	10.56
Patria Investments	$327.60 million	N/A	$118.40 million	$0.81	17.44

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

Summary

Patria Investments beats Diamond Hill Investment Group on 10 of the 14 factors compared between the two stocks.

About Diamond Hill Investment Group

Diamond Hill Investment Group, Inc., through its subsidiary, Diamond Hill Capital Management, Inc., provides investment advisory and fund administration services in the United States. It offers investment advisory and related services to clients through pooled vehicles, such as private fund; separately managed accounts; collective investment trusts; and other pooled vehicles, including sub-advised funds and model delivery programs. The company also provides fund administration services comprising portfolio and regulatory compliance, treasury and financial oversight, and general business management and governance of the funds, as well as oversight of back-office service providers, which include the custodian, fund accountant, and transfer agent. Diamond Hill Investment Group, Inc. was incorporated in 1990 and is based in Columbus, Ohio.

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.