Financial Contrast: Virtus Investment Partners (VRTS) versus Eaton Vance (EV)

Virtus Investment Partners (NASDAQ: VRTS) and Eaton Vance (NYSE:EV) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, profitability, valuation, earnings, dividends and risk.

Dividends

Virtus Investment Partners pays an annual dividend of $1.80 per share and has a dividend yield of 1.6%. Eaton Vance pays an annual dividend of $1.24 per share and has a dividend yield of 2.2%. Virtus Investment Partners pays out 33.6% of its earnings in the form of a dividend. Eaton Vance pays out 51.2% 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. Virtus Investment Partners has raised its dividend for 36 consecutive years.

Risk and Volatility

Virtus Investment Partners has a beta of 1.9, suggesting that its share price is 90% more volatile than the S&P 500. Comparatively, Eaton Vance has a beta of 1.9, suggesting that its share price is 90% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and target prices for Virtus Investment Partners and Eaton Vance, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Virtus Investment Partners 0 5 0 0 2.00
Eaton Vance 0 5 2 0 2.29

Virtus Investment Partners currently has a consensus price target of $130.00, indicating a potential upside of 13.19%. Eaton Vance has a consensus price target of $51.36, indicating a potential downside of 9.53%. Given Virtus Investment Partners’ higher possible upside, research analysts plainly believe Virtus Investment Partners is more favorable than Eaton Vance.

Valuation and Earnings

This table compares Virtus Investment Partners and Eaton Vance’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Virtus Investment Partners $322.55 million 2.55 $48.50 million $5.36 21.43
Eaton Vance $1.53 billion 4.38 $282.13 million $2.42 23.46

Eaton Vance has higher revenue and earnings than Virtus Investment Partners. Virtus Investment Partners is trading at a lower price-to-earnings ratio than Eaton Vance, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

95.8% of Virtus Investment Partners shares are owned by institutional investors. Comparatively, 68.7% of Eaton Vance shares are owned by institutional investors. 4.0% of Virtus Investment Partners shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Virtus Investment Partners and Eaton Vance’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Virtus Investment Partners 11.64% 12.75% 3.21%
Eaton Vance 18.45% 33.45% 13.84%

Summary

Eaton Vance beats Virtus Investment Partners on 10 of the 16 factors compared between the two stocks.

Virtus Investment Partners Company Profile

Virtus Investment Partners, Inc. (Virtus) is a provider of investment management and related services to individuals and institutions. The Company provides its products in various forms and through multiple distribution channels. Its retail products include open-end mutual funds, closed-end funds, exchange traded funds, variable insurance funds, undertakings for collective investments in transferable securities (UCITS) and separately managed accounts. Its open-end mutual funds are distributed through intermediaries. Its closed-end funds trade on the New York Stock Exchange. Its variable insurance funds are available as investment options in variable annuities and life insurance products distributed by life insurance companies. Separately managed accounts consists of intermediary programs, sponsored and distributed by unaffiliated brokerage firms, and private client accounts, which are offered to the high net-worth clients of its affiliated managers.

Eaton Vance Company Profile

Eaton Vance Corp. is engaged in the business of managing investment funds and providing investment management and advisory services to high-net-worth individuals and institutions. The Company operates as an investment advisor to funds and separate accounts. The Company, through its subsidiaries and other affiliates, manages active equity, income and alternative strategies across a range of investment styles and asset classes, including the United States and global equities, floating-rate bank loans, municipal bonds, global income, high-yield and investment grade bonds. Through its subsidiary, the Company also manages a range of engineered alpha strategies, including systematic equity, systematic alternatives and managed options strategies. The Company’s open-end fund lineup includes tax-managed equity funds, and non-tax-managed equity and multi-asset funds. The Company’s family of closed-end funds includes municipal bond, domestic and global equity, and bank loan.

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