Head-To-Head Review: TPG (NASDAQ:TPG) & ONEX (OTCMKTS:ONEXF)

ONEX (OTCMKTS:ONEXF) and TPG (NASDAQ:TPG) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their valuation, profitability, dividends, analyst recommendations, risk, earnings and institutional ownership.

Institutional & Insider Ownership

0.7% of ONEX shares are owned by institutional investors. Comparatively, 94.0% of TPG shares are owned by institutional investors. 61.4% of TPG shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares ONEX and TPG”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ONEX	$899.00 million	6.61	$617.00 million	$6.68	11.66
TPG	$3.59 billion	5.21	$184.59 million	$0.87	55.99

ONEX has higher earnings, but lower revenue than TPG. ONEX is trading at a lower price-to-earnings ratio than TPG, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares ONEX and TPG’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ONEX	63.83%	5.24%	4.21%
TPG	5.32%	29.05%	8.15%

Dividends

ONEX pays an annual dividend of $0.28 per share and has a dividend yield of 0.4%. TPG pays an annual dividend of $2.20 per share and has a dividend yield of 4.5%. ONEX pays out 4.2% of its earnings in the form of a dividend. TPG pays out 252.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Analyst Ratings

This is a breakdown of current ratings for ONEX and TPG, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ONEX	0	1	2	0	2.67
TPG	0	4	11	0	2.73

TPG has a consensus price target of $61.00, indicating a potential upside of 25.22%. Given TPG’s stronger consensus rating and higher probable upside, analysts plainly believe TPG is more favorable than ONEX.

Volatility & Risk

ONEX has a beta of 1.25, indicating that its stock price is 25% more volatile than the S&P 500. Comparatively, TPG has a beta of 1.48, indicating that its stock price is 48% more volatile than the S&P 500.

Summary

TPG beats ONEX on 11 of the 16 factors compared between the two stocks.

About ONEX

Onex Corporation is a private equity firm specializing in acquisitions and platform acquisitions. The firm makes investments in buyouts, large- middle market, large-cap, mid-cap, and small-cap market and distressed companies. It also invests in recapitalization, growth capital, corporate carve-outs of subsidiaries and mission-critical supply divisions from multinational corporations, operational restructurings of undervalued businesses, and builds up. The firm seeks to invest in technology, electronics manufacturing services, industrial, aerospace, healthcare, retail, restaurants, industrials products, customer care services, metal services, building products, entertainment, gaming, cabinetry products, commercial vehicles, commercial and investment banking, financial services, commercial and multi-unit residential real estate. It invests in global businesses headquartered in North America, including United States and Canada, or Europe. The firm seeks to invest between $125 million and $1 billion in companies that have minimum revenues of $300 million. It does not consider size if the company is in an industry in which the firm already has presence. The firm seeks to make direct as well as co-investments through managed private equity, real estate and credit funds. It seeks to acquire a control position in its portfolio companies. Onex Corporation was founded in 1984 and is based in Toronto, Canada with additional offices in New York, New York; Englewood Cliffs, New Jersey; Boston, Massachusetts and London, United Kingdom.

About TPG

TPG Inc. operates as an alternative asset manager in the United States and internationally. The company offers investment management services to TPG Funds, limited partners, and other vehicles. It also offers monitoring services to portfolio companies; advisory, debt and equity arrangement, and underwriting and placement services; and capital structuring and other advisory services to portfolio companies. In addition, the company invests in private equity funds, real estate funds, hedge funds, and credit funds. TPG Inc. was founded in 1992 and is based in Fort Worth, Texas. The company operates as a subsidiary of TPG GP A, LLC.