Head-To-Head Analysis: Hywin (NASDAQ:HYW) versus StepStone Group (NASDAQ:STEP)

StepStone Group (NASDAQ:STEP) and Hywin (NASDAQ:HYW) are both finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their earnings, risk, valuation, profitability, dividends, analyst recommendations and institutional ownership.

Insider & Institutional Ownership

55.5% of StepStone Group shares are owned by institutional investors. 19.9% of StepStone Group shares are owned by company insiders. Comparatively, 84.6% of Hywin shares are owned 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.

Valuation and Earnings

This table compares StepStone Group and Hywin”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
StepStone Group	$720.02 million	9.32	$58.09 million	$0.90	67.42
Hywin	$1.85 billion	0.01	$18.71 million	$0.96	0.38

StepStone Group has higher earnings, but lower revenue than Hywin. Hywin is trading at a lower price-to-earnings ratio than StepStone Group, 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 StepStone Group and Hywin, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
StepStone Group	0	5	3	0	2.38
Hywin	0	0	0	0	N/A

StepStone Group presently has a consensus price target of $47.19, suggesting a potential downside of 22.24%. Given StepStone Group’s higher probable upside, research analysts clearly believe StepStone Group is more favorable than Hywin.

Profitability

This table compares StepStone Group and Hywin’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
StepStone Group	N/A	10.02%	4.55%
Hywin	N/A	N/A	N/A

Risk & Volatility

StepStone Group has a beta of 1.28, suggesting that its stock price is 28% more volatile than the S&P 500. Comparatively, Hywin has a beta of -0.11, suggesting that its stock price is 111% less volatile than the S&P 500.

Summary

StepStone Group beats Hywin on 9 of the 12 factors compared between the two stocks.

About StepStone Group

StepStone Group LP. is an investment firm specializing in direct, fund of funds, secondary direct, and secondary indirect investments. For direct investment, it seeks to invest in venture debt, incubation, mezzanine, distressed/vulture, seed/startup, early venture, mid venture, late venture, emerging growth, later stage, turnaround, growth capital, industry consolidation, recapitalization, private equity and 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, consumer staples, financials, telecommunication services, energy, infrastructure, real estate, 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. It typically invests between $15 million and $200 million in firms with enterprise value between $150 million and $25000 million. 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 LP. was founded in 2007 and is based in LA Jolla, California with additional offices across North America, South America, Europe, Australia, Asia, New York, New York.

About Hywin

Hywin Holdings Ltd., through its subsidiaries, provides wealth management, asset management, health management, insurance brokerage, and other financial services in China. It operates through two segments: Wealth and Health. The company distributes asset-backed products, such as real estate securitization products, as well as equity investments in real estate projects or private project companies; venture capital, private equity, and hedge funds; and supply chain financing and cash management products. It also offers public market investment products, including money market funds, such as government bonds, central bank bills, term and certificates of deposits, and corporate commercial papers; bond funds comprising government, corporate, and convertible bonds, as well as other traded debt instruments; and equities and multi-strategy funds. In addition, the company provides individual whole life insurance, individual term life insurance, universal life insurance, individual health insurance, and annuity insurance products, as well as critical illness insurance, including personal accident insurance products. Further, it manages and distributes various private funds to professional investors; offers discretionary and advisory mandates to ultra-high-net-worth clients; rents and manages properties; and provides residential property investment services, including client referrals to overseas and charge property developers. Additionally, the company provides healthcare solutions, such as medical examinations, chronic disease management, immune system enhancement, and anti-aging solutions, as well as mild aesthetic medicines; and information technology services, including transaction process management, data analysis, and system maintenance services to asset management service and financial product providers. Hywin Holdings Ltd. was founded in 2006 and is headquartered in Shanghai, China. Hywin Holdings Ltd. operates as a subsidiary of Grand Lead Group Limited.