UBS AG (UBS) and Noah Holdings (NOAH) Critical Analysis

UBS AG (NYSE: UBS) and Noah Holdings (NYSE:NOAH) are both mid-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, analyst recommendations, risk, institutional ownership, dividends, valuation and earnings.

Valuation & Earnings

This table compares UBS AG and Noah Holdings’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
UBS AG $30.48 billion 2.07 $4.05 billion $1.09 15.61
Noah Holdings $402.75 million 5.50 $120.70 million $1.73 22.67

UBS AG has higher revenue and earnings than Noah Holdings. UBS AG is trading at a lower price-to-earnings ratio than Noah Holdings, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

UBS AG has a beta of 1.24, suggesting that its share price is 24% more volatile than the S&P 500. Comparatively, Noah Holdings has a beta of 2.6, suggesting that its share price is 160% more volatile than the S&P 500.

Profitability

This table compares UBS AG and Noah Holdings’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
UBS AG 11.28% 8.01% 0.47%
Noah Holdings 29.39% 18.42% 11.94%

Dividends

UBS AG pays an annual dividend of $0.60 per share and has a dividend yield of 3.5%. Noah Holdings does not pay a dividend. UBS AG pays out 55.0% of its earnings in the form of a dividend. UBS AG has raised its dividend for 4 consecutive years.

Analyst Recommendations

This is a breakdown of current ratings and price targets for UBS AG and Noah Holdings, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
UBS AG 0 4 4 0 2.50
Noah Holdings 0 0 1 0 3.00

Noah Holdings has a consensus price target of $29.00, indicating a potential downside of 26.06%. Given Noah Holdings’ stronger consensus rating and higher possible upside, analysts plainly believe Noah Holdings is more favorable than UBS AG.

Insider and Institutional Ownership

31.6% of UBS AG shares are held by institutional investors. Comparatively, 41.3% of Noah Holdings shares are held by institutional investors. 1.0% of UBS AG shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

Noah Holdings beats UBS AG on 11 of the 17 factors compared between the two stocks.

UBS AG Company Profile

UBS Group AG is a holding company and conducts its operations through UBS AG and its subsidiaries. The Company comprises Corporate Center and five business divisions: Wealth Management, Wealth Management Americas, Personal & Corporate Banking, Asset Management and the Investment Bank. Wealth Management division provides advice and tailored financial services to wealthy private clients around the world, except those served by Wealth Management Americas. Wealth Management Americas division is a wealth manager in the Americas in terms of financial advisor productivity and invested assets by financial advisor. Personal & Corporate Banking division provides financial products and services to private, corporate and institutional clients in Switzerland. Asset Management division provides investment management products and services, platform solutions and advisory support. Investment Bank division provides investment advice, financial solutions and capital markets access.

Noah Holdings Company Profile

Noah Holdings Limited is a wealth management service provider with a focus on global wealth investment and asset allocation services for high net worth individuals and enterprises in China. The Company operates through three segments: wealth management, asset management and Internet finance. It also provides Internet finance services to clients in China. It provides direct access to China’s high net worth population. With approximately 1,100 relationship managers in over 130 branch offices, its coverage network includes China’s regions where high net worth population is concentrated, including the Yangtze River Delta, the Pearl River Delta, the Bohai Rim and other regions. Its product offerings consist primarily of over-the-counter (OTC) wealth management and OTC asset management products, mutual fund products and asset management plans originated in China and designed to cater to the needs of China’s high net worth population.

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