Head-To-Head Comparison: Janus Capital Group (JNS) versus Waddell & Reed Financial (WDR)

Janus Capital Group (NYSE: JNS) and Waddell & Reed Financial (NYSE:WDR) are both investment management & fund operators – nec companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, institutional ownership, valuation, earnings, analyst recommendations, dividends and profitability.

Earnings and Valuation

This table compares Janus Capital Group and Waddell & Reed Financial’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Janus Capital Group N/A N/A N/A $0.76 18.64
Waddell & Reed Financial $1.24 billion 1.52 $146.90 million $1.39 16.29

Waddell & Reed Financial has higher revenue and earnings than Janus Capital Group. Waddell & Reed Financial is trading at a lower price-to-earnings ratio than Janus Capital Group, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Janus Capital Group and Waddell & Reed Financial, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Janus Capital Group 1 1 0 0 1.50
Waddell & Reed Financial 5 2 0 0 1.29

Janus Capital Group presently has a consensus target price of $13.00, suggesting a potential downside of 8.26%. Waddell & Reed Financial has a consensus target price of $18.43, suggesting a potential downside of 18.60%. Given Janus Capital Group’s stronger consensus rating and higher probable upside, analysts plainly believe Janus Capital Group is more favorable than Waddell & Reed Financial.

Dividends

Janus Capital Group pays an annual dividend of $0.44 per share and has a dividend yield of 3.1%. Waddell & Reed Financial pays an annual dividend of $1.84 per share and has a dividend yield of 8.1%. Janus Capital Group pays out 57.9% of its earnings in the form of a dividend. Waddell & Reed Financial pays out 132.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Janus Capital Group has raised its dividend for 6 consecutive years and Waddell & Reed Financial has raised its dividend for 6 consecutive years.

Profitability

This table compares Janus Capital Group and Waddell & Reed Financial’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Janus Capital Group 12.54% 7.26% 4.48%
Waddell & Reed Financial 10.10% 16.81% 10.22%

Insider and Institutional Ownership

90.2% of Janus Capital Group shares are held by institutional investors. Comparatively, 97.4% of Waddell & Reed Financial shares are held by institutional investors. 2.1% of Janus Capital Group shares are held by insiders. Comparatively, 3.8% of Waddell & Reed Financial shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Summary

Waddell & Reed Financial beats Janus Capital Group on 7 of the 11 factors compared between the two stocks.

About Janus Capital Group

Janus Capital Group Inc. provides investment management, administration, distribution and related services to financial advisors, individuals and institutional clients through mutual funds, separate accounts, other pooled investment vehicles, exchange-traded products (ETPs) and subadvised relationships (collectively referred to as investment products) in both domestic and international markets. The Company operates through investment management business segment. The Company provides investment management solutions across a range of disciplines, including fundamental the United States and global equities (growth and value), mathematical equities, fixed income and alternatives. As of December 31, 2016, the Company’s investment products were distributed through three primary channels: intermediary, institutional and self-directed. Each distribution channel focuses on specific investor groups and the requirements of each group.

About Waddell & Reed Financial

Waddell & Reed Financial, Inc., incorporated on December 24, 1981, is a holding company. The Company is a mutual fund and asset management company. The Company provides investment management, investment advisory, investment product underwriting, and distribution and shareholder services administration to Waddell & Reed Advisors group of mutual funds (the Advisors Funds), Ivy Funds, Ivy Funds Variable Insurance Portfolios (Ivy Funds VIP), InvestEd Portfolios and 529 college savings plan (collectively, the Funds), and the Ivy Global Investors Fund SICAV (the SICAV) and its Ivy Global Investors sub-funds (the IGI Funds), and institutional and separately managed accounts. The Company operates its business through a distribution network. Its retail products are distributed through third parties, such as other broker-dealers, registered investment advisors and various retirement platforms or through associated independent contractor financial advisors.

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