Hut 8 (NASDAQ:HUT) vs. Houlihan Lokey (NYSE:HLI) Head-To-Head Review

Hut 8 (NASDAQ:HUT) and Houlihan Lokey (NYSE:HLI) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their profitability, dividends, institutional ownership, earnings, valuation, risk and analyst recommendations.

Analyst Recommendations

This is a summary of recent recommendations for Hut 8 and Houlihan Lokey, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hut 8	0	0	16	3	3.16
Houlihan Lokey	0	2	3	0	2.60

Hut 8 presently has a consensus target price of $29.88, indicating a potential downside of 14.69%. Houlihan Lokey has a consensus target price of $210.60, indicating a potential upside of 3.60%. Given Houlihan Lokey’s higher probable upside, analysts clearly believe Houlihan Lokey is more favorable than Hut 8.

Valuation & Earnings

This table compares Hut 8 and Houlihan Lokey”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hut 8	$162.38 million	22.77	$331.88 million	N/A	N/A
Houlihan Lokey	$2.39 billion	5.98	$399.71 million	$5.94	34.22

Houlihan Lokey has higher revenue and earnings than Hut 8.

Institutional & Insider Ownership

31.8% of Hut 8 shares are owned by institutional investors. Comparatively, 78.1% of Houlihan Lokey shares are owned by institutional investors. 11.2% of Hut 8 shares are owned by company insiders. Comparatively, 22.8% of Houlihan Lokey shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Volatility and Risk

Hut 8 has a beta of 4.33, meaning that its share price is 333% more volatile than the S&P 500. Comparatively, Houlihan Lokey has a beta of 0.86, meaning that its share price is 14% less volatile than the S&P 500.

Profitability

This table compares Hut 8 and Houlihan Lokey’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hut 8	112.81%	8.73%	5.72%
Houlihan Lokey	16.46%	23.75%	14.21%

Summary

Houlihan Lokey beats Hut 8 on 7 of the 13 factors compared between the two stocks.

About Hut 8

Hut 8 Corp., together with its subsidiaries, acquires, builds, manages, and operates data centers for digital assets mining, computing, and artificial intelligence in the United States. It operates in four segments: Digital Assets Mining, Managed Services, High Performance Computing Colocation and Cloud, and Other. The company mines Bitcoin. It also offers managed services for energy infrastructure development, such as site design, procurement, and construction management; software automation, process design, personnel hiring, and team training; utilities contracts, hosting operations, and customer management; energy portfolio optimization and strategic initiatives; and finance, accounting, and safety services for digital asset mining site owners, governments, and data center developers. In addition, the company provides colocation, cloud, and connectivity services; hosting services, which include the provision of mining equipment and space, as well as monitors, troubleshoots, repairs, and maintains customer mining equipment; and equipment sales and repair services. Hut 8 Corp. was founded in 2017 and is based in Miami, Florida.

About Houlihan Lokey

Houlihan Lokey, Inc., an investment banking company, provides merger and acquisition (M&A), capital market, financial restructuring, and financial and valuation advisory services worldwide. It operates in three segments: Corporate Finance, Financial Restructuring, and Financial and Valuation Advisory. The Corporate Finance segment offers general financial advisory services; and advises public and private institutions on buy-side and sell-side transactions, leveraged loans, private mezzanine debt, high-yield debt, initial public offerings, follow-ons, convertibles, equity private placements, private equity, and liability management transactions, as well as advise financial sponsors on various transactions. The Financial Restructuring segment advises debtors, creditors, and other parties-in-interest related to recapitalization/deleveraging transactions. It also provides a range of advisory services, including structuring, negotiation, and confirmation of plans of reorganization; structuring and analysis of exchange offers; corporate viability assessment; dispute resolution and expert testimony; and procuring debtor-in-possession financing. The Financial and Valuation Advisory segment offers valuations of various assets, such as companies, illiquid debt and equity securities, and intellectual property. It also provides fairness opinions in connection with M&A and other transactions, solvency opinions in connection with corporate spin-offs and dividend recapitalizations, and other types of financial opinions. In addition, this segment offers dispute resolution services. It serves corporations, financial sponsors, and government agencies. The company was incorporated in 1972 and is headquartered in Los Angeles, California.