Critical Comparison: Bread Financial (NYSE:BFH) vs. PJT Partners (NYSE:PJT)

PJT Partners (NYSE:PJT) and Bread Financial (NYSE:BFH) are both mid-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their earnings, risk, valuation, dividends, profitability, analyst recommendations and institutional ownership.

Analyst Recommendations

This is a breakdown of current ratings and price targets for PJT Partners and Bread Financial, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
PJT Partners	1	4	0	0	1.80
Bread Financial	3	6	4	0	2.08

PJT Partners presently has a consensus price target of $174.6667, indicating a potential downside of 2.71%. Bread Financial has a consensus price target of $64.4167, indicating a potential upside of 7.79%. Given Bread Financial’s stronger consensus rating and higher possible upside, analysts plainly believe Bread Financial is more favorable than PJT Partners.

Earnings & Valuation

This table compares PJT Partners and Bread Financial”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
PJT Partners	$1.49 billion	2.92	$238.47 million	$5.82	30.85
Bread Financial	$4.80 billion	0.58	$277.00 million	$5.91	10.11

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

Profitability

This table compares PJT Partners and Bread Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
PJT Partners	10.45%	25.61%	14.50%
Bread Financial	6.05%	13.10%	1.83%

Institutional and Insider Ownership

89.2% of PJT Partners shares are held by institutional investors. Comparatively, 99.5% of Bread Financial shares are held by institutional investors. 11.8% of PJT Partners shares are held by company insiders. Comparatively, 0.6% of Bread Financial 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.

Dividends

PJT Partners pays an annual dividend of $1.00 per share and has a dividend yield of 0.6%. Bread Financial pays an annual dividend of $0.84 per share and has a dividend yield of 1.4%. PJT Partners pays out 17.2% of its earnings in the form of a dividend. Bread Financial pays out 14.2% 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. Bread Financial is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk & Volatility

PJT Partners has a beta of 0.77, suggesting that its share price is 23% less volatile than the S&P 500. Comparatively, Bread Financial has a beta of 1.42, suggesting that its share price is 42% more volatile than the S&P 500.

Summary

Bread Financial beats PJT Partners on 10 of the 16 factors compared between the two stocks.

About PJT Partners

PJT Partners Inc., an investment bank, provides various strategic and capital markets advisory, restructuring and special situations, and shareholder advisory services to corporations, financial sponsors, institutional investors, and governments worldwide. It offers advisory services to clients on various transactions, including mergers and acquisitions (M&A), spin-offs, activism defense, contested M&A, joint ventures, minority investments, and divestitures. The company also advises private and public company boards and management teams on strategies for building productive investor relationships with a focus on shareholder engagement; and strategic investor relations; environmental, social, and governance matters; and other investor-related matters. In addition, it provides advisory services related to debt and acquisition financings; structured product offerings; public equity raises, including initial public offering and SPAC offerings; and private capital raises for early and later stage companies, as well as other capital structure related matters. Further, the company offers advisory services in financial restructurings and reorganizations; liability management; distressed mergers and acquisitions; and to management teams, corporate boards, sponsors and creditors. Additionally, it provides private fund advisory and fundraising services for a range of investment strategies; and advisory services to general and partners on liquidity and other structured solutions. The company was formerly known as Blackstone Advisory Inc. and changed its name to PJT Partners Inc. in March 2015. PJT Partners Inc. was incorporated in 2014 and is headquartered in New York, New York.

About Bread Financial

Bread Financial Holdings, Inc. provides tech-forward payment and lending solutions to customers and consumer-based industries in North America. It offers credit card and other loans financing services, including risk management solutions, account origination, and funding services for private label and co-brand credit card programs, as well as through Bread partnerships; and Comenity-branded general purpose cash-back credit. The company also manages and services the loans it originates for private label, co-brand, and general-purpose credit card programs, and installment loans and split-pay products; and provides marketing, and data and analytics services. In addition, it offers an enhanced digital suite that includes a unified software development kit, which provides access to its suite of products, as well as promotes credit payment options earlier in the shopping experience. Further, the company through Bread, a digital payments platform and robust suite of application programming interfaces allows merchants and partners to integrate online point-of-sale financing and other digital payment products. It offers its products under the Bread CashbackTM, Bread PayTM, and Bread SavingsTM brands. The company was formerly known as Alliance Data Systems Corporation and changed its name to Bread Financial Holdings, Inc. in March 2022. Bread Financial Holdings, Inc. was incorporated in 1995 and is headquartered in Columbus, Ohio.