State Street (NYSE:STT – Get Free Report) and Jefferies Financial Group (NYSE:JEF – Get Free Report) are both finance companies, but which is the superior investment? We will compare the two companies based on the strength of their dividends, institutional ownership, valuation, analyst recommendations, risk, profitability and earnings.
Dividends
State Street pays an annual dividend of $3.68 per share and has a dividend yield of 2.1%. Jefferies Financial Group pays an annual dividend of $1.60 per share and has a dividend yield of 3.6%. State Street pays out 32.5% of its earnings in the form of a dividend. Jefferies Financial Group pays out 43.8% 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. State Street has increased its dividend for 13 consecutive years and Jefferies Financial Group has increased its dividend for 2 consecutive years.
Profitability
This table compares State Street and Jefferies Financial Group’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| State Street | 15.02% | 15.26% | 0.96% |
| Jefferies Financial Group | 7.50% | 9.26% | 1.29% |
Insider and Institutional Ownership
Volatility & Risk
State Street has a beta of 1.41, indicating that its stock price is 41% more volatile than the S&P 500. Comparatively, Jefferies Financial Group has a beta of 1.57, indicating that its stock price is 57% more volatile than the S&P 500.
Earnings & Valuation
This table compares State Street and Jefferies Financial Group”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| State Street | $22.63 billion | 2.12 | $2.94 billion | $11.34 | 15.43 |
| Jefferies Financial Group | $10.82 billion | 0.79 | $710.47 million | $3.65 | 12.16 |
State Street has higher revenue and earnings than Jefferies Financial Group. Jefferies Financial Group is trading at a lower price-to-earnings ratio than State Street, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a breakdown of recent recommendations and price targets for State Street and Jefferies Financial Group, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| State Street | 0 | 6 | 10 | 0 | 2.62 |
| Jefferies Financial Group | 0 | 5 | 2 | 0 | 2.29 |
State Street presently has a consensus price target of $193.38, suggesting a potential upside of 10.54%. Jefferies Financial Group has a consensus price target of $56.86, suggesting a potential upside of 28.07%. Given Jefferies Financial Group’s higher possible upside, analysts clearly believe Jefferies Financial Group is more favorable than State Street.
Summary
State Street beats Jefferies Financial Group on 12 of the 17 factors compared between the two stocks.
About State Street
State Street Corporation, through its subsidiaries, provides a range of financial products and services to institutional investors worldwide. The company offers investment servicing products and services, including custody, accounting, regulatory reporting, investor, and performance and analytics; middle office products, such as IBOR, transaction management, loans, cash, derivatives and collateral, record keeping, and client reporting and investment analytics; finance leasing; foreign exchange, and brokerage and other trading services; securities finance and enhanced custody products; deposit and short-term investment facilities; investment manager and alternative investment manager operations outsourcing; performance, risk, and compliance analytics; and financial data management to support institutional investors. It also engages in the provision of portfolio management and risk analytics, as well as trading and post-trade settlement services with integrated compliance and managed data. In addition, the company offers investment management strategies and products, such as core and enhanced indexing, multi-asset strategies, active quantitative and fundamental active capabilities, and alternative investment strategies. Further, it provides services and solutions, including environmental, social, and governance investing; defined benefit and defined contribution; and global fiduciary solutions, as well as exchange-traded funds under the SPDR ETF brand. The company provides its products and services to mutual funds, collective investment funds, UCITS, hedge funds and other investment pools, corporate and public retirement plans, insurance companies, foundations, endowments, and investment managers. State Street Corporation was founded in 1792 and is headquartered in Boston, Massachusetts.
About Jefferies Financial Group
Jefferies Financial Group Inc. operates as an investment banking and capital markets firm in the Americas, Europe, the Middle East, and the Asia-Pacific. The company operates in two segments, Investment Banking and Capital Markets, and Asset Management. It provides investment banking, advisory services with respect to mergers or acquisitions, debt financing, restructurings or recapitalizations, and private capital advisory transactions; underwriting and placement services related to corporate debt, municipal bonds, mortgage-backed and asset-backed securities, equity and equity-linked securities, and loan syndication services; and corporate lending services. The company also offers financing, securities lending, and other prime brokerage services; equities research, sales, and trading services; wealth management services; and online foreign exchange trading services. In addition, it provides investment grade distressed debt securities, U.S. and European government and agency securities, municipal bonds, leveraged loans, emerging markets debt, and interest rate and credit index derivative products; and manages and offers services to a diverse group of alternative asset management platforms across a spectrum of investment strategies and asset classes. The company was formerly known as Leucadia National Corporation and changed its name to Jefferies Financial Group Inc. in May 2018. Jefferies Financial Group Inc. was founded in 1962 and is headquartered in New York, New York.
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