Heidrick & Struggles International (NASDAQ: HSII) and DHI Group (NYSE:DHX) are both small-cap business services companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitabiliy, earnings, analyst recommendations, dividends, institutional ownership, valuation and risk.
Dividends
Heidrick & Struggles International pays an annual dividend of $0.52 per share and has a dividend yield of 2.9%. DHI Group does not pay a dividend. Heidrick & Struggles International pays out -96.3% of its earnings in the form of a dividend.
Profitability
This table compares Heidrick & Struggles International and DHI Group’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Heidrick & Struggles International | -1.66% | 8.25% | 3.94% |
| DHI Group | -3.80% | 13.19% | 4.55% |
Valuation & Earnings
This table compares Heidrick & Struggles International and DHI Group’s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | EBITDA | Earnings Per Share | Price/Earnings Ratio | |
| Heidrick & Struggles International | $595.56 million | 0.57 | $55.61 million | ($0.54) | -33.43 |
| DHI Group | $215.60 million | 0.54 | $39.50 million | ($0.17) | -13.53 |
Heidrick & Struggles International has higher revenue and earnings than DHI Group. Heidrick & Struggles International is trading at a lower price-to-earnings ratio than DHI Group, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
82.5% of Heidrick & Struggles International shares are owned by institutional investors. Comparatively, 81.2% of DHI Group shares are owned by institutional investors. 2.4% of Heidrick & Struggles International shares are owned by company insiders. Comparatively, 7.2% of DHI Group shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Volatility & Risk
Heidrick & Struggles International has a beta of 1.57, meaning that its stock price is 57% more volatile than the S&P 500. Comparatively, DHI Group has a beta of 0.89, meaning that its stock price is 11% less volatile than the S&P 500.
Analyst Recommendations
This is a breakdown of current ratings for Heidrick & Struggles International and DHI Group, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Heidrick & Struggles International | 0 | 2 | 0 | 0 | 2.00 |
| DHI Group | 0 | 4 | 1 | 0 | 2.20 |
Heidrick & Struggles International presently has a consensus target price of $25.00, indicating a potential upside of 38.50%. DHI Group has a consensus target price of $6.25, indicating a potential upside of 171.74%. Given DHI Group’s stronger consensus rating and higher probable upside, analysts plainly believe DHI Group is more favorable than Heidrick & Struggles International.
Summary
Heidrick & Struggles International beats DHI Group on 9 of the 16 factors compared between the two stocks.
Heidrick & Struggles International Company Profile
Heidrick & Struggles International, Inc. is an advisory firm providing executive search, leadership consulting and culture shaping services to businesses and business leaders around the world. Its segments include Executive Search, Leadership Consulting and Culture Shaping. It operates its executive search services in three geographic regions: the Americas (which includes the countries in North and South America); Europe (which includes the continents of Europe and Africa), and Asia Pacific (which includes Asia and the region generally known as the Middle East). Its Leadership Consulting segment operates globally. Its Culture Shaping segment operates in the Americas and Europe. In addition to executive search, it provides leadership consulting expertise and culture shaping services including executive leadership assessment; leadership, team and board development; succession planning; talent strategy; people performance; inter-team collaboration, and organizational transformation.
DHI Group Company Profile
DHI Group, Inc. provides data, insights and employment connections through specialized services for professional communities, including technology and security clearance, financial services, energy, healthcare and hospitality. The Company’s segments are Tech & Clearance, which includes Dice, Dice Europe and ClearanceJobs; Global Industry Group, which includes eFinancialCareers, Rigzone, Hcareers and BioSpace; Healthcare, which includes Health eCareers, and Corporate & Other. It sells recruitment packages, which allow customers to post jobs and source candidates through its resume databases and, in case of Dice, Dice Europe and eFinancialCareers, to utilize its Open Web search service. Its products and services include resume databases, job postings, open Web, and content and data. Its brands include Dice, Dice Europe, ClearanceJobs, Targeted Job Fairs, eFinancialCareers, Rigzone, BioSpace, Hcareers and Health eCareers.
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