Piper Jaffray (PJC) & Alex. Brown (RJF) Financial Contrast

Piper Jaffray (NYSE: PJC) and Alex. Brown (NYSE:RJF) are both finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, dividends, risk, profitability, earnings and institutional ownership.

Analyst Recommendations

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This is a breakdown of recent ratings and target prices for Piper Jaffray and Alex. Brown, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Piper Jaffray 1 4 1 0 2.00
Alex. Brown 0 2 5 0 2.71

Piper Jaffray presently has a consensus target price of $30.93, suggesting a potential downside of 63.03%. Alex. Brown has a consensus target price of $101.14, suggesting a potential upside of 16.58%. Given Alex. Brown’s stronger consensus rating and higher probable upside, analysts clearly believe Alex. Brown is more favorable than Piper Jaffray.

Earnings & Valuation

This table compares Piper Jaffray and Alex. Brown’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Piper Jaffray $895.19 million 1.42 -$61.93 million N/A N/A
Alex. Brown $6.52 billion 1.94 $636.23 million $5.23 16.59

Alex. Brown has higher revenue and earnings than Piper Jaffray.

Risk and Volatility

Piper Jaffray has a beta of 1.55, indicating that its stock price is 55% more volatile than the S&P 500. Comparatively, Alex. Brown has a beta of 1.6, indicating that its stock price is 60% more volatile than the S&P 500.

Institutional and Insider Ownership

70.2% of Piper Jaffray shares are owned by institutional investors. Comparatively, 71.0% of Alex. Brown shares are owned by institutional investors. 4.2% of Piper Jaffray shares are owned by insiders. Comparatively, 10.5% of Alex. Brown shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Piper Jaffray and Alex. Brown’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Piper Jaffray -7.30% 11.58% 4.72%
Alex. Brown 9.00% 14.87% 2.42%

Dividends

Piper Jaffray pays an annual dividend of $1.50 per share and has a dividend yield of 1.8%. Alex. Brown pays an annual dividend of $1.00 per share and has a dividend yield of 1.2%. Alex. Brown pays out 19.1% of its earnings in the form of a dividend. Alex. Brown has raised its dividend for 5 consecutive years.

Summary

Alex. Brown beats Piper Jaffray on 13 of the 16 factors compared between the two stocks.

About Piper Jaffray

Piper Jaffray Companies is an investment bank and asset management company. The Company’s segments include Capital Markets and Asset Management. The Capital Markets segment provides investment banking and institutional sales, trading and research services for various equity and fixed income products. The Asset Management segment includes its traditional asset management business and its investments in registered funds and private funds or partnerships that it manages. It provides a range of products and services, including equity and debt capital markets products; public finance services; financial advisory services; equity and fixed income institutional brokerage; equity and fixed income research, and asset management services. The Company serves the needs of corporations, private equity groups, public entities, non-profit entities and institutional investors in the United States and internationally.

About Alex. Brown

Raymond James Financial, Inc., a financial holding company, through its subsidiaries, engages in the underwriting, distribution, trading, and brokerage of equity and debt securities, and the sale of mutual funds and other investment products in the United States, Canada, Europe, and internationally. The company operates through Private Client Group, Capital Markets, Asset Management, RJ Bank, and Other segments. The Private Client Group segment provides securities brokerage services, including the sale of equities, mutual funds, fixed income products, and insurance products to their individual clients; and borrowing and lending of securities to and from other broker-dealers, financial institutions, and other counterparties. The Capital Markets segment offers securities brokerage, trading, and research services to institutions with a focus on sale of the United States and Canadian equities and fixed income products; and manages and participates in underwritings, merger and acquisition services, and public finance activities. The Asset Management segment engages in the operations of Eagle, the Eagle Family of Funds, Cougar, the asset management operations of Raymond James & Associates, trust services of Raymond James Trust, and other fee-based asset management programs. The RJ Bank segment provides corporate loans, SBL, tax-exempt loans, and residential loans. The Other segment engages in private equity activities, including various direct and third party private equity investments; and private equity funds. Raymond James Financial, Inc. was founded in 1962 and is based in St. Petersburg, Florida.

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