StepStone Group (NASDAQ:STEP – Get Free Report) and DigitalBridge Group (NYSE:DBRG – Get Free Report) are both mid-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, profitability, earnings, institutional ownership, risk, analyst recommendations and valuation.
Dividends
StepStone Group pays an annual dividend of $0.96 per share and has a dividend yield of 1.5%. DigitalBridge Group pays an annual dividend of $0.04 per share and has a dividend yield of 0.3%. StepStone Group pays out 160.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. DigitalBridge Group pays out 5.5% of its earnings in the form of a dividend.
Analyst Recommendations
This is a breakdown of recent recommendations and price targets for StepStone Group and DigitalBridge Group, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| StepStone Group | 0 | 4 | 3 | 0 | 2.43 |
| DigitalBridge Group | 0 | 1 | 6 | 1 | 3.00 |
Profitability
This table compares StepStone Group and DigitalBridge Group’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| StepStone Group | N/A | 11.18% | 5.04% |
| DigitalBridge Group | 21.42% | 3.58% | 1.72% |
Volatility & Risk
StepStone Group has a beta of 1.27, suggesting that its stock price is 27% more volatile than the S&P 500. Comparatively, DigitalBridge Group has a beta of 1.94, suggesting that its stock price is 94% more volatile than the S&P 500.
Valuation and Earnings
This table compares StepStone Group and DigitalBridge Group”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| StepStone Group | $711.63 million | 9.97 | $58.09 million | $0.60 | 106.87 |
| DigitalBridge Group | $1.50 billion | 1.45 | $185.28 million | $0.73 | 17.15 |
DigitalBridge Group has higher revenue and earnings than StepStone Group. DigitalBridge Group is trading at a lower price-to-earnings ratio than StepStone Group, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
55.5% of StepStone Group shares are held by institutional investors. Comparatively, 92.7% of DigitalBridge Group shares are held by institutional investors. 18.4% of StepStone Group shares are held by company insiders. Comparatively, 3.4% of DigitalBridge Group shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Summary
DigitalBridge Group beats StepStone Group on 11 of the 17 factors compared between the two stocks.
About StepStone Group
StepStone Group Inc. is a private equity and venture capital firm specializing in direct, fund of funds, secondary direct, and secondary indirect investments. For direct investment, it seeks to invest in private debt, venture debt, incubation, mezzanine, distressed/vulture, seed/startup, early venture, mid venture, late venture, emerging growth, later stage, turnaround, growth capital, industry consolidation, recapitalization, buyout investments in mature and middle market companies. It prefers to invest in natural resources, technology, healthcare, services, materials, manufacturing, consumer durables, apparel, hotels, restaurants and leisure, media, retailing, power, utilities consumer staples, financials, telecommunication services, clean energy/renewables, transport, social, natural capital, infrastructure, corporate, real estate, credit and real asset. The firm invests globally with a focus on United States, North America, Europe, Asia, Latin America, Middle East, Africa, Brazil, Mexico, Argentina, Colombia, New Zealand, China, India, Korea, Japan, Taiwan, and Australia region. The firm invests between 5% and 40% in emerging markets. For fund of fund investment, it seeks to invest in private equity funds, venture capital funds, Special situation funds, Real estate funds, Infrastructure funds, mezzanine funds, and turnaround/distressed funds. It considers investments in both domestic and international funds. It also seeks to make co-investments and follow-on investments and considers partial interests in funds. StepStone Group Inc. was founded in 2007 and is based in New York, New York with additional offices across North America, South America, Europe, Australia and Asia.
About DigitalBridge Group
DigitalBridge is an infrastructure investment firm specializing in digital infrastructure assets. They provide services to institutional investors. They primarily invest in data centers, cell towers, fiber networks, small cells, and edge infrastructure. DigitalBridge Group, Inc. was founded in 1991 and is headquartered in Boca Raton, Florida with additional offices in Los Angles, California, and New York New York.
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