GAMCO Investors (NYSE:GAMI – Get Rating) and The Goldman Sachs Group (NYSE:GS – Get Rating) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their valuation, earnings, risk, dividends, institutional ownership, analyst recommendations and profitability.
Institutional & Insider Ownership
30.5% of GAMCO Investors shares are held by institutional investors. Comparatively, 69.1% of The Goldman Sachs Group shares are held by institutional investors. 81.2% of GAMCO Investors shares are held by company insiders. Comparatively, 0.6% of The Goldman Sachs Group shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
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Valuation & Earnings
This table compares GAMCO Investors and The Goldman Sachs Group's revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
| GAMCO Investors | $301.13 million | 1.40 | $73.20 million | $2.09 | 7.66 |
| The Goldman Sachs Group | $64.99 billion | 1.90 | $21.64 billion | $37.55 | 9.71 |
The Goldman Sachs Group has higher revenue and earnings than GAMCO Investors. GAMCO Investors is trading at a lower price-to-earnings ratio than The Goldman Sachs Group, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares GAMCO Investors and The Goldman Sachs Group's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
| GAMCO Investors | 19.78% | 51.48% | 24.10% |
| The Goldman Sachs Group | 22.50% | 13.23% | 0.89% |
Dividends
GAMCO Investors pays an annual dividend of $0.16 per share and has a dividend yield of 1.0%. The Goldman Sachs Group pays an annual dividend of $10.00 per share and has a dividend yield of 2.7%. GAMCO Investors pays out 7.7% of its earnings in the form of a dividend. The Goldman Sachs Group pays out 26.6% 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. The Goldman Sachs Group has raised its dividend for 2 consecutive years. The Goldman Sachs Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Analyst Ratings
This is a breakdown of current ratings and recommmendations for GAMCO Investors and The Goldman Sachs Group, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
| GAMCO Investors | 0 | 0 | 0 | 0 | N/A |
| The Goldman Sachs Group | 1 | 6 | 9 | 0 | 2.50 |
The Goldman Sachs Group has a consensus target price of $400.36, indicating a potential upside of 9.84%. Given The Goldman Sachs Group's higher probable upside, analysts clearly believe The Goldman Sachs Group is more favorable than GAMCO Investors.
Volatility and Risk
GAMCO Investors has a beta of 1.26, meaning that its stock price is 26% more volatile than the S&P 500. Comparatively, The Goldman Sachs Group has a beta of 1.41, meaning that its stock price is 41% more volatile than the S&P 500.
Summary
The Goldman Sachs Group beats GAMCO Investors on 12 of the 16 factors compared between the two stocks.
About GAMCO Investors
(Get Rating)
GAMCO Investors, Inc. is a publicly owned holding investment manager. The firm also provides wealth management, investment advisory, institutional research, brokerage, dealer, underwriting, and distribution services to its clients. It provides its services to individuals including high net worth individuals, corporate pension and profit-sharing plans, foundations, endowments, jointly trust plans, municipalities, and investment companies. The firm, through its subsidiaries, manages separate client-focused equity, fixed income, and balanced portfolios. It also launches equity, fixed income, and balanced mutual funds and manages equity mutual funds for its clients. Through its subsidiaries the firm invests in the public equity and fixed income markets across the globe. It invests in value stocks of companies. The firm employs fundamental analysis with a focus on bottom-up stock picking approach to create its portfolios. It conducts in-house research to make its investments. The firm was founded in 1976 and is based in Rye, New York with additional offices in Greenwich, Connecticut; Bannockburn, Illinois; and Tokyo, Japan. GAMCO Investors, Inc. operates as a subsidiary of Ggcp Holdings Llc.
About The Goldman Sachs Group
(Get Rating)
The Goldman Sachs Group, Inc., a financial institution, provides a range of financial services for corporations, financial institutions, governments, and individuals worldwide. It operates through four segments: Investment Banking, Global Markets, Asset Management, and Consumer & Wealth Management. The company's Investment Banking segment provides financial advisory services, including strategic advisory assignments related to mergers and acquisitions, divestitures, corporate defense activities, restructurings, and spin-offs; and middle-market lending, relationship lending, and acquisition financing, as well as transaction banking services. This segment also offers underwriting services, such as equity underwriting for common and preferred stock and convertible and exchangeable securities; and debt underwriting for various types of debt instruments, including investment-grade and high-yield debt, bank and bridge loans, and emerging-and growth-market debt, as well as originates structured securities. Its Global Markets segment is involved in client execution activities for cash and derivative instruments; credit and interest rate products; and provision of equity intermediation and equity financing, clearing, settlement, and custody services, as well as mortgages, currencies, commodities, and equities related products. The company's Asset Management segment manages assets across various classes, including equity, fixed income, hedge funds, credit funds, private equity, real estate, currencies, and commodities; and provides customized investment advisory solutions, as well as invests in corporate, real estate, and infrastructure entities. Its Consumer & Wealth Management segment offers wealth advisory and banking services, including financial planning, investment management, deposit taking, and lending; private banking; and unsecured loans, as well as accepts saving and time deposits. The company was founded in 1869 and is headquartered in New York, New York.
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