Comparing ONEX (OTCMKTS:ONEXF) and SEI Investments (NASDAQ:SEIC)

ONEX (OTCMKTS:ONEXF) and SEI Investments (NASDAQ:SEIC) are both finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their earnings, dividends, institutional ownership, risk, profitability, analyst recommendations and valuation.

Dividends

ONEX pays an annual dividend of $0.29 per share and has a dividend yield of 0.3%. SEI Investments pays an annual dividend of $0.98 per share and has a dividend yield of 1.1%. ONEX pays out 4.0% of its earnings in the form of a dividend. SEI Investments pays out 18.4% 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. SEI Investments has raised its dividend for 34 consecutive years. SEI Investments is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation & Earnings

This table compares ONEX and SEI Investments”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ONEX	$649.00 million	9.14	$303.00 million	$7.32	11.50
SEI Investments	$2.13 billion	5.24	$581.19 million	$5.33	16.91

SEI Investments has higher revenue and earnings than ONEX. ONEX is trading at a lower price-to-earnings ratio than SEI Investments, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares ONEX and SEI Investments’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ONEX	61.92%	6.14%	3.86%
SEI Investments	31.25%	29.96%	26.10%

Analyst Recommendations

This is a summary of current recommendations and price targets for ONEX and SEI Investments, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ONEX	0	0	2	0	3.00
SEI Investments	0	3	3	0	2.50

SEI Investments has a consensus price target of $102.00, indicating a potential upside of 13.14%. Given SEI Investments’ higher possible upside, analysts clearly believe SEI Investments is more favorable than ONEX.

Institutional & Insider Ownership

0.7% of ONEX shares are held by institutional investors. Comparatively, 70.6% of SEI Investments shares are held by institutional investors. 14.6% of SEI Investments shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Volatility & Risk

ONEX has a beta of 1.35, suggesting that its share price is 35% more volatile than the S&P 500. Comparatively, SEI Investments has a beta of 0.95, suggesting that its share price is 5% less volatile than the S&P 500.

Summary

SEI Investments beats ONEX on 11 of the 17 factors compared between the two stocks.

About ONEX

Onex Corporation is a private equity firm specializing in acquisitions and platform acquisitions. The firm makes investments in buyouts, large- middle market, large-cap, mid-cap, and small-cap market and distressed companies. It also invests in recapitalization, growth capital, corporate carve-outs of subsidiaries and mission-critical supply divisions from multinational corporations, operational restructurings of undervalued businesses, and builds up. The firm seeks to invest in technology, electronics manufacturing services, industrial, aerospace, healthcare, retail, restaurants, industrials products, customer care services, metal services, building products, entertainment, gaming, cabinetry products, commercial vehicles, commercial and investment banking, financial services, commercial and multi-unit residential real estate. It invests in global businesses headquartered in North America, including United States and Canada, or Europe. The firm seeks to invest between $125 million and $1 billion in companies that have minimum revenues of $300 million. It does not consider size if the company is in an industry in which the firm already has presence. The firm seeks to make direct as well as co-investments through managed private equity, real estate and credit funds. It seeks to acquire a control position in its portfolio companies. Onex Corporation was founded in 1984 and is based in Toronto, Canada with additional offices in New York, New York; Englewood Cliffs, New Jersey; Boston, Massachusetts and London, United Kingdom.

About SEI Investments

SEI Investments Company is a publicly owned asset management holding company. Through its subsidiaries, the firm provides wealth management, retirement and investment solutions, asset management, asset administration, investment processing outsourcing solutions, financial services, and investment advisory services to its clients. It provides its services to private banks, independent financial advisers, institutional investors, investment managers, investment advisors, wealth management organizations, corporations, retirement scheme sponsors, not-for-profit organizations, hedge fund managers, registered investment advisers, independent broker-dealers, financial planners, life insurance agents, defined-benefit schemes, defined-contribution schemes, endowments, foundations, and board-designated fund, through its subsidiaries. Through its subsidiaries, the firm manages separate client-focused portfolios. It also launches and manages equity, fixed income, and balanced mutual funds, through its subsidiaries. Through its subsidiaries, the firm invests in public equity and fixed income markets. It employs fundamental and quantitative analysis with a focus on top-down and bottom-up analysis to make its investments, through its subsidiaries. SEI Investments Company was founded in 1968 and is based in Oaks, Pennsylvania.