Financial Comparison: Merriman (OTCMKTS:MERR) versus Diamond Hill Investment Group (NASDAQ:DHIL)

Merriman (OTCMKTS:MERR) and Diamond Hill Investment Group (NASDAQ:DHIL) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their earnings, dividends, valuation, profitability, risk, analyst recommendations and institutional ownership.

Institutional and Insider Ownership

65.5% of Diamond Hill Investment Group shares are held by institutional investors. 63.0% of Merriman shares are held by insiders. Comparatively, 4.6% of Diamond Hill Investment Group 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.

Valuation and Earnings

This table compares Merriman and Diamond Hill Investment Group”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Merriman	N/A	N/A	N/A	N/A	N/A
Diamond Hill Investment Group	$151.10 million	3.02	$43.18 million	$17.22	9.79

Diamond Hill Investment Group has higher revenue and earnings than Merriman.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Merriman and Diamond Hill Investment Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Merriman	0	0	0	0	0.00
Diamond Hill Investment Group	0	1	0	0	2.00

Given Merriman’s higher probable upside, equities research analysts clearly believe Merriman is more favorable than Diamond Hill Investment Group.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Merriman	N/A	N/A	N/A
Diamond Hill Investment Group	31.32%	20.71%	14.34%

Summary

Diamond Hill Investment Group beats Merriman on 6 of the 8 factors compared between the two stocks.

About Merriman

Merriman Holdings, Inc., through its subsidiary, Merriman Capital, Inc., provides capital market advisory and research, corporate, and investment banking services primarily in the United States and Canada. The company's investment banking services include corporate financing services, such as initial public offerings, secondary offerings, and private placements services; and strategic advisory services comprise transaction-specific advice regarding mergers and acquisitions, divestitures, spin-offs, and privatizations, as well as general strategic advice. It also offers institutional brokerage services, including institutional sales trading and equity execution, and options execution services to institutional clients. In addition, the company executes securities transactions for money managers, mutual funds, hedge funds, insurance companies, and pension and profit-sharing plans; and provides integrated research and trading solutions, as well as capital markets advisory services. It primarily serves institutional investors and corporate clients. The company was formerly known as Merriman Curhan Ford Group, Inc. and changed its name to Merriman Holdings, Inc. in August 2010. Merriman Holdings, Inc. was founded in 1987 and is headquartered in San Francisco, California.

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.