Critical Analysis: Oppenheimer (OPY) versus The Competition

Oppenheimer (NYSE:OPY) is one of 1,744 public companies in the “Capital Markets” industry, but how does it compare to its peers? We will compare Oppenheimer to related companies based on the strength of its valuation, profitability, earnings, risk, institutional ownership, analyst recommendations and dividends.

Profitability

This table compares Oppenheimer and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Oppenheimer	4.94%	19.11%	4.80%
Oppenheimer Competitors	311.61%	79.26%	3.71%

Risk and Volatility

Oppenheimer has a beta of 1.12, indicating that its share price is 12% more volatile than the S&P 500. Comparatively, Oppenheimer’s peers have a beta of 0.80, indicating that their average share price is 20% less volatile than the S&P 500.

Valuation & Earnings

This table compares Oppenheimer and its peers top-line revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Oppenheimer	$1.64 billion	$148.40 million	9.63
Oppenheimer Competitors	$5.23 billion	$396.39 million	16.47

Oppenheimer’s peers have higher revenue and earnings than Oppenheimer. Oppenheimer is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Institutional & Insider Ownership

32.3% of Oppenheimer shares are owned by institutional investors. Comparatively, 30.6% of shares of all “Capital Markets” companies are owned by institutional investors. 34.9% of Oppenheimer shares are owned by insiders. Comparatively, 12.9% of shares of all “Capital Markets” companies are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Dividends

Oppenheimer pays an annual dividend of $0.80 per share and has a dividend yield of 0.9%. Oppenheimer pays out 9.0% of its earnings in the form of a dividend. As a group, “Capital Markets” companies pay a dividend yield of 3.2% and pay out 30.0% of their earnings in the form of a dividend. Oppenheimer has raised its dividend for 1 consecutive years.

Analyst Ratings

This is a breakdown of current recommendations for Oppenheimer and its peers, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Oppenheimer	0	0	2	0	3.00
Oppenheimer Competitors	5540	20100	22425	641	2.37

As a group, “Capital Markets” companies have a potential upside of 25.33%. Given Oppenheimer’s peers higher possible upside, analysts plainly believe Oppenheimer has less favorable growth aspects than its peers.

Summary

Oppenheimer peers beat Oppenheimer on 8 of the 15 factors compared.

Oppenheimer Company Profile

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.