Oppenheimer (NYSE:OPY) versus Northern Trust (NASDAQ:NTRS) Financial Contrast

Northern Trust (NASDAQ:NTRS) and Oppenheimer (NYSE:OPY) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, profitability, valuation, dividends, analyst recommendations and risk.

Analyst Ratings

This is a breakdown of current recommendations for Northern Trust and Oppenheimer, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Northern Trust	2	9	4	0	2.13
Oppenheimer	0	0	2	0	3.00

Northern Trust presently has a consensus target price of $183.93, suggesting a potential upside of 9.37%. Given Northern Trust’s higher probable upside, analysts clearly believe Northern Trust is more favorable than Oppenheimer.

Insider & Institutional Ownership

83.2% of Northern Trust shares are owned by institutional investors. Comparatively, 32.3% of Oppenheimer shares are owned by institutional investors. 0.7% of Northern Trust shares are owned by insiders. Comparatively, 34.9% of Oppenheimer shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Risk and Volatility

Northern Trust has a beta of 1.24, indicating that its stock price is 24% more volatile than the S&P 500. Comparatively, Oppenheimer has a beta of 1.1, indicating that its stock price is 10% more volatile than the S&P 500.

Earnings and Valuation

This table compares Northern Trust and Oppenheimer”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Northern Trust	$14.30 billion	2.15	$1.74 billion	$11.65	14.44
Oppenheimer	$1.64 billion	0.78	$148.40 million	$8.86	13.40

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

Profitability

This table compares Northern Trust and Oppenheimer’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Northern Trust	14.76%	16.91%	1.18%
Oppenheimer	5.72%	19.51%	4.86%

Dividends

Northern Trust pays an annual dividend of $3.52 per share and has a dividend yield of 2.1%. Oppenheimer pays an annual dividend of $0.80 per share and has a dividend yield of 0.7%. Northern Trust pays out 30.2% of its earnings in the form of a dividend. Oppenheimer pays out 9.0% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Oppenheimer has increased its dividend for 1 consecutive years.

Summary

Northern Trust beats Oppenheimer on 11 of the 17 factors compared between the two stocks.

About Northern Trust

Northern Trust Corporation, a financial holding company, provides wealth management, asset servicing, asset management, and banking solutions for corporations, institutions, families, and individuals worldwide. It operates in two segments, Asset Servicing and Wealth Management. The Asset Servicing segment offers asset servicing and related services, including custody, fund administration, investment operations outsourcing, investment management, investment risk and analytical services, employee benefit services, securities lending, foreign exchange, treasury management, brokerage services, transition management services, banking, and cash management services. This segment serves corporate and public retirement funds, foundations, endowments, fund managers, insurance companies, sovereign wealth funds, and other institutional investors. The Wealth Management segment offers trust, investment management, custody, and philanthropic; financial consulting; guardianship and estate administration; family business consulting; family financial education; brokerage services; and private and business banking services. This segment serves high-net-worth individuals and families, business owners, executives, professionals, retirees, and established privately held businesses. The company also provides asset management services, such as active and passive equity; active and passive fixed income; cash management; muti-asset and alternative asset classes comprising private equity and hedge funds of funds; and multi-manager advisory services and products through separately managed accounts, bank common and collective funds, registered investment companies, exchange traded funds, non-U.S. collective investment funds, and unregistered private investment funds. In addition, it offers overlay and other risk management services. Northern Trust Corporation was founded in 1889 and is headquartered in Chicago, Illinois.

About Oppenheimer

Oppenheimer Holdings Inc. operates as a middle-market investment bank and full-service broker-dealer in the Americas, Europe, the Middle East, and Asia. The company provides brokerage services covering corporate equity and debt securities, money market instruments, exchange-traded options and futures contracts, municipal bonds, mutual funds, exchange-traded funds, and unit investment trusts; financial and wealth planning services; and margin lending services. It offers asset management services, including separately managed accounts, mutual fund managed accounts, discretionary portfolio management programs, non-discretionary investment advisory and consultation services, alternative investments, portfolio enhancement programs, and institutional taxable fixed income portfolio management strategies and solutions, as well as taxable and non-taxable fixed income portfolios and strategies. In addition, the company offers investment banking services, such as strategic advisory services and capital markets products; merger and acquisition, equities capital market, debt capital market, debt advisory and restructuring, and fund placement services; and institutional equity sales and trading, equity research, equity derivatives and index options, convertible bonds, event driven sales and trading, and portfolio and electronic trading. Further, it provides institutional fixed income sales and trading, fixed income research, public finance, and municipal trading services; and proprietary trading and investment activities. Additionally, the company offers underwriting, market-making, trust, and discount services, as well as a cloud-based financial market. It serves high-net-worth individuals and families, corporate executives, public and private businesses, institutions and corporations, governments, financial sponsors, and domestic and international investors. Oppenheimer Holdings Inc. was founded in 1881 and is headquartered in New York, New York.