Comparing Blackstone (NYSE:BX) and Heritage Global (NASDAQ:HGBL)

Blackstone (NYSE:BX) and Heritage Global (NASDAQ:HGBL) are both finance companies, but which is the better business? We will contrast the two businesses based on the strength of their risk, profitability, analyst recommendations, institutional ownership, earnings, valuation and dividends.

Profitability

This table compares Blackstone and Heritage Global’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Blackstone	20.89%	22.17%	9.41%
Heritage Global	6.18%	4.69%	3.60%

Volatility and Risk

Blackstone has a beta of 1.76, indicating that its share price is 76% more volatile than the S&P 500. Comparatively, Heritage Global has a beta of 0.53, indicating that its share price is 47% less volatile than the S&P 500.

Institutional and Insider Ownership

70.0% of Blackstone shares are owned by institutional investors. Comparatively, 33.5% of Heritage Global shares are owned by institutional investors. 1.0% of Blackstone shares are owned by company insiders. Comparatively, 14.0% of Heritage Global 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.

Valuation & Earnings

This table compares Blackstone and Heritage Global”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Blackstone	$14.45 billion	6.63	$3.02 billion	$3.88	33.44
Heritage Global	$45.36 million	1.02	$5.18 million	$0.09	14.78

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

Analyst Ratings

This is a summary of current ratings and recommmendations for Blackstone and Heritage Global, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Blackstone	0	11	11	0	2.50
Heritage Global	1	1	1	1	2.50

Blackstone presently has a consensus price target of $174.77, suggesting a potential upside of 34.72%. Heritage Global has a consensus price target of $4.00, suggesting a potential upside of 200.75%. Given Heritage Global’s higher probable upside, analysts clearly believe Heritage Global is more favorable than Blackstone.

Summary

Blackstone beats Heritage Global on 11 of the 14 factors compared between the two stocks.

About Blackstone

Blackstone Inc. is an alternative asset management firm specializing in real estate, private equity, hedge fund solutions, credit, secondary funds of funds, public debt and equity and multi-asset class strategies. The firm typically invests in early-stage companies. It also provide capital markets services. The real estate segment specializes in opportunistic, core+ investments as well as debt investment opportunities collateralized by commercial real estate, and stabilized income-oriented commercial real estate across North America, Europe and Asia. The firm's corporate private equity business pursues transactions throughout the world across a variety of transaction types, including large buyouts,special situations, distressed mortgage loans, mid-cap buyouts, buy and build platforms, which involves multiple acquisitions behind a single management team and platform, and growth equity/development projects involving significant majority stakes in portfolio companies and minority investments in operating companies, shipping, real estate, corporate or consumer loans, and alternative energy greenfield development projects in energy and power, property, dislocated markets, shipping opportunities, financial institution breakups, re-insurance, and improving freight mobility, financial services, healthcare, life sciences, infrastructure, enterprise tech and consumer, as well as consumer technologies. The firm considers investment in Asia and Latin America. It seeks to invest between $0.25 million and $900 million per transaction. It invests in companies with enterprise value between $500 million and $5000 million. It has a three year investment period. Its hedge fund business manages a broad range of commingled and customized fund solutions and its credit business focuses on loans, and securities of non-investment grade companies spread across the capital structure including senior debt, subordinated debt, preferred stock and common equity. Blackstone Inc. was founded in 1985 and is headquartered in New York, New York with additional offices across Asia, Europe, North America and Central America.

About Heritage Global

Heritage Global Inc., together with its subsidiaries, operates as an asset services company with focus on financial and industrial asset transactions. The company operates in three segments: Auction and Liquidation, Refurbishment & Resale, and Brokerage. It provides a suite of market making, acquisitions, refurbishment, dispositions, valuations, and secured lending services. The company focuses on identifying, valuing, acquiring, and monetizing underlying tangible assets. It acts as an adviser, as well as a principal, acquiring, or brokering manufacturing facilities; surplus industrial machinery and equipment; industrial inventories; and charged-off receivable portfolios. The company was formerly known as Counsel RB Capital Inc. and changed its name to Heritage Global, Inc. in August 2013. Heritage Global, Inc. was founded in 1937 and is headquartered in San Diego, California.