Head to Head Survey: Federated Hermes (NYSE:FHI) and CI Financial (NYSE:CIXXF)

Federated Hermes (NYSE:FHI) and CI Financial (NYSE:CIXXF) are both mid-cap finance companies, but which is the superior stock? We will compare the two companies based on the strength of their analyst recommendations, risk, valuation, dividends, profitability, earnings and institutional ownership.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Federated Hermes and CI Financial, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Federated Hermes	0	4	2	0	2.33
CI Financial	1	1	0	0	1.50

Federated Hermes currently has a consensus target price of $42.17, indicating a potential upside of 9.84%. Given Federated Hermes’ stronger consensus rating and higher possible upside, equities analysts clearly believe Federated Hermes is more favorable than CI Financial.

Insider & Institutional Ownership

75.9% of Federated Hermes shares are held by institutional investors. 3.7% of Federated Hermes shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Dividends

Federated Hermes pays an annual dividend of $1.24 per share and has a dividend yield of 3.2%. CI Financial pays an annual dividend of $0.59 per share and has a dividend yield of 2.7%. Federated Hermes pays out 39.9% of its earnings in the form of a dividend. CI Financial pays out -178.8% 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.

Profitability

This table compares Federated Hermes and CI Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Federated Hermes	16.62%	29.85%	16.05%
CI Financial	-2.28%	57.73%	5.23%

Valuation and Earnings

This table compares Federated Hermes and CI Financial”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Federated Hermes	$1.60 billion	1.96	$298.98 million	$3.11	12.34
CI Financial	$2.03 billion	1.52	$3.72 million	($0.33)	-65.18

Federated Hermes has higher earnings, but lower revenue than CI Financial. CI Financial is trading at a lower price-to-earnings ratio than Federated Hermes, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Federated Hermes has a beta of 1.16, meaning that its stock price is 16% more volatile than the S&P 500. Comparatively, CI Financial has a beta of 1.42, meaning that its stock price is 42% more volatile than the S&P 500.

Summary

Federated Hermes beats CI Financial on 12 of the 16 factors compared between the two stocks.

About Federated Hermes

Federated Hermes, Inc. is a publicly owned investment manager. Through its subsidiaries, the firm provides its services to individuals, including high net worth individuals, banking or thrift institutions, investment companies, pension and profit sharing plans, pooled investment vehicles, charitable organizations, state or municipal government entities, and registered investment advisors. Through its subsidiaries, it manages separate client-focused equity, fixed income, balanced and money market mutual funds along with separate client-focused equity, fixed income, money market, and balanced portfolios. Through its subsidiaries, the firm invests in the public equity and fixed income markets across the globe. It invests in growth and value stocks of small-cap, mid-cap, and large-cap companies. The firm makes its fixed income investments in ultra-short, short-term, and intermediate-term mortgage-backed, U.S. Government, U.S. corporate, high yield, and municipal securities. It employs both fundamental and quantitative analysis to make its equity investments. Federated Hermes, Inc. was founded in 1955 and is based in Pittsburgh, Pennsylvania with additional offices in New York City and London, United Kingdom.

About CI Financial

CI Financial Corp. is a publicly owned asset management holding company. Through its subsidiaries, the firm manages separate client focused equity, fixed income, and alternative investments portfolios. It also manages mutual funds, hedge funds, and fund of funds for its clients through its subsidiaries. The firm was founded in 1965 and is based in Toronto, Canada with additional offices in Vancouver, Canada; Calgary, Canada; and Montreal, Canada.