KKR & Co. Inc. (NYSE:KKR) versus B. Riley Financial (NASDAQ:RILY) Head-To-Head Analysis

B. Riley Financial (NASDAQ:RILY) and KKR & Co. Inc. (NYSE:KKR) are both business services companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, dividends, profitability, risk and valuation.

Insider and Institutional Ownership

50.2% of B. Riley Financial shares are owned by institutional investors. Comparatively, 76.3% of KKR & Co. Inc. shares are owned by institutional investors. 32.9% of B. Riley Financial shares are owned by company insiders. Comparatively, 39.3% of KKR & Co. Inc. shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Volatility & Risk

B. Riley Financial has a beta of 1.32, suggesting that its stock price is 32% more volatile than the S&P 500. Comparatively, KKR & Co. Inc. has a beta of 1.62, suggesting that its stock price is 62% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations for B. Riley Financial and KKR & Co. Inc., as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
B. Riley Financial	0	0	0	0	N/A
KKR & Co. Inc.	0	1	13	0	2.93

KKR & Co. Inc. has a consensus target price of $101.20, indicating a potential downside of 18.09%. Given KKR & Co. Inc.’s higher possible upside, analysts clearly believe KKR & Co. Inc. is more favorable than B. Riley Financial.

Profitability

This table compares B. Riley Financial and KKR & Co. Inc.’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
B. Riley Financial	-9.28%	-25.84%	-1.75%
KKR & Co. Inc.	19.38%	4.52%	0.86%

Dividends

B. Riley Financial pays an annual dividend of $2.00 per share and has a dividend yield of 10.4%. KKR & Co. Inc. pays an annual dividend of $0.70 per share and has a dividend yield of 0.6%. B. Riley Financial pays out -39.9% of its earnings in the form of a dividend. KKR & Co. Inc. pays out 15.7% 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. B. Riley Financial is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings and Valuation

This table compares B. Riley Financial and KKR & Co. Inc.’s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
B. Riley Financial	$1.65 billion	0.35	-$99.91 million	($5.01)	-3.83
KKR & Co. Inc.	$14.50 billion	7.56	$3.73 billion	$4.46	27.70

KKR & Co. Inc. has higher revenue and earnings than B. Riley Financial. B. Riley Financial is trading at a lower price-to-earnings ratio than KKR & Co. Inc., indicating that it is currently the more affordable of the two stocks.

Summary

KKR & Co. Inc. beats B. Riley Financial on 13 of the 15 factors compared between the two stocks.

About B. Riley Financial

B. Riley Financial, Inc., through its subsidiaries, provides financial services to corporate, institutional, and high net worth clients in North America, Australia, the Asia Pacific, and Europe. The company operates through six segments: Capital Markets, Wealth Management, Financial Consulting, Auction and Liquidation, Communications, and Consumer. The Capital Markets segments offers investment banking, equity research, institutional sales and trading, securities lending, fund and asset management, direct lending, venture capital, proprietary trading, and investment services; merger and acquisition, restructuring advisory, and recapitalization services; public and private equity offerings; and debt financing solutions. This segment also trades in equity securities. The Wealth Management segment provides wealth management and tax services. The Financial Consulting segment offers bankruptcy restructuring and turnaround management, forensic accounting and litigation support, valuation and appraisal, and real estate services. The Auction and Liquidation Segment provides auction and liquidation services. The Communications segment offers dial-up, mobile broadband and digital subscriber line services under the NetZero and Juno brands; cloud communication services; VoIP cloud-based technology and communication devices and subscription services through magicJack; and mobile phone voice, text, and data services and devices through Marconi Wireless. The Consumer segment sells laptop and computer accessories. The company was formerly known as Great American Group, Inc. and changed its name to B. Riley Financial, Inc. in November 2014. B. Riley Financial, Inc. was founded in 1973 and is headquartered in Los Angeles, California.

About KKR & Co. Inc.

KKR & Co. Inc. is a private equity and real estate investment firm specializing in direct and fund of fund investments. It specializes in acquisitions, leveraged buyouts, management buyouts, credit special situations, growth equity, mature, mezzanine, distressed, turnaround, lower middle market and middle market investments. The firm considers investments in all industries with a focus on software, security, semiconductors, consumer electronics, internet of things (iot), internet, information services, information technology infrastructure, financial technology, network and cyber security architecture, engineering and operations, content, technology and hardware, energy and infrastructure, real estate, services industry with a focus on business services, intelligence, industry-leading franchises and companies in natural resource, containers and packaging, agriculture, airports, ports, forestry, electric utilities, textiles, apparel and luxury goods, household durables, digital media, insurance, brokerage houses, non-durable goods distribution, supermarket retailing, grocery stores, food, beverage, and tobacco, hospitals, entertainment venues and production companies, publishing, printing services, capital goods, financial services, specialized finance, pipelines, and renewable energy. In energy and infrastructure, it focuses on the upstream oil and gas and equipment, minerals and royalties and services verticals. In real estate, the firm seeks to invest in private and public real estate securities including property-level equity, debt and special situations transactions and businesses with significant real estate holdings, and oil and natural gas properties. The firm also invests in asset services sector that encompasses a broad array of B2B, B2C and B2G services verticals including asset-based, transport, logistics, leisure/hospitality, resource and utility support, infra-like, mission-critical, and environmental services. Within Americas, the firm prefers to invest in consumer products; chemicals, metals and mining; energy and natural resources; financial services; healthcare; industrials; media and communications; retail; and technology. Within Europe, the firm invests in consumer and retail; energy; financial services; health care; industrials and chemicals; media and digital; and telecom and technologies. Within Asia, it invests in consumer products; energy and resources; financial services; healthcare; industrials; logistics; media and telecom; retail; real estate; and technology. It also seeks to make impact investments focused on identifying and investing behind businesses with positive social or environmental impact. The firm seeks to invest in mid to high-end residential developments, but can invest in other projects throughout Mainland China through outright ownership, joint ventures, and merger. It invests globally with a focus on Australia, emerging and developed Asia, Middle East and Africa, Nordic, Southeast Asia, Asia Pacific, Ireland, Hong Kong, Japan, Taiwan, India, Vietnam, Malaysia, Singapore, Indonesia, France, Germany, Netherlands, United Kingdom, Caribbean, Mexico, South America, North America, Brazil, Latin America, Korea with a focus on South Korea, and United States of America. In the United States and Europe, the firm focuses on buyouts of large, publicly traded companies. It seeks to invest $30 million to $717 million in companies with enterprise values between $500 million to $2389 million. The firm prefers to invest in a range of debt and public equity investing and may co-invest. It seeks a board seat in its portfolio companies and a controlling ownership of a company or a strategic minority positions. The firm may acquire majority and minority equity interests, particularly when making private equity investments in Asia or sponsoring investments as part of a large investor consortium. The firm typically holds its investment for a period of five to seven years and more and exits through initial public offerings, secondary offerings, and sales to strategic buyers. KKR & Co. Inc. was founded in 1976 and is based in New York, New York with additional offices across North America, Europe, Australia, Sweden and Asia.