Head-To-Head Review: Five Point (NYSE:FPH) vs. Marcus & Millichap (NYSE:MMI)

Five Point (NYSE:FPH) and Marcus & Millichap (NYSE:MMI) are both small-cap finance companies, but which is the better business? We will compare the two companies based on the strength of their institutional ownership, profitability, analyst recommendations, valuation, earnings, risk and dividends.

Risk and Volatility

Five Point has a beta of 1.5, suggesting that its stock price is 50% more volatile than the S&P 500. Comparatively, Marcus & Millichap has a beta of 1.28, suggesting that its stock price is 28% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and price targets for Five Point and Marcus & Millichap, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Five Point	0	1	1	0	2.50
Marcus & Millichap	1	2	0	0	1.67

Valuation & Earnings

This table compares Five Point and Marcus & Millichap”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Five Point	$237.93 million	3.76	$68.30 million	$1.09	5.50
Marcus & Millichap	$696.06 million	1.58	-$12.36 million	($0.31)	-90.78

Five Point has higher earnings, but lower revenue than Marcus & Millichap. Marcus & Millichap is trading at a lower price-to-earnings ratio than Five Point, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

38.1% of Five Point shares are owned by institutional investors. Comparatively, 62.8% of Marcus & Millichap shares are owned by institutional investors. 21.5% of Five Point shares are owned by insiders. Comparatively, 39.9% of Marcus & Millichap shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Five Point and Marcus & Millichap’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Five Point	39.43%	3.61%	2.52%
Marcus & Millichap	-1.69%	-1.99%	-1.49%

Summary

Five Point beats Marcus & Millichap on 10 of the 13 factors compared between the two stocks.

About Five Point

Five Point Holdings, LLC, through its subsidiary, Five Point Operating Company, LP, owns and develops mixed-use and planned communities in Orange County, Los Angeles County, and San Francisco County. The company operates in four segments: Valencia, San Francisco, Great Park, and Commercial. It sells residential and commercial land sites to homebuilders, commercial developers, and commercial buyers; operates and owns a commercial office, research and development, medical campus, and other properties; and provides development and property management services. The company was formerly known as Newhall Holding Company, LLC and changed its name to Five Point Holdings, LLC in May 2016. Five Point Holdings, LLC was incorporated in 2009 and is headquartered in Irvine, California.

About Marcus & Millichap

Marcus & Millichap, Inc. engages in the provision of investment real estate brokerage services. It specializes in commercial real estate investment sales, property financing, research, and advisory services. The company was founded by George M. Marcus and William A. Millichap in 1971 and is headquartered in Calabasas, CA.