Leucadia National (NYSE: JEF) and Jefferies Financial Group (NYSE:JEF) are both mid-cap multi-sector conglomerates companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, earnings, risk, profitability, analyst recommendations, dividends and valuation.
Risk and Volatility
Leucadia National has a beta of 1.27, suggesting that its share price is 27% more volatile than the S&P 500. Comparatively, Jefferies Financial Group has a beta of 1.16, suggesting that its share price is 16% more volatile than the S&P 500.
This is a breakdown of recent ratings and target prices for Leucadia National and Jefferies Financial Group, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Jefferies Financial Group||0||0||1||0||3.00|
Jefferies Financial Group has a consensus price target of $29.00, suggesting a potential upside of 24.36%. Given Jefferies Financial Group’s higher possible upside, analysts plainly believe Jefferies Financial Group is more favorable than Leucadia National.
Leucadia National pays an annual dividend of $0.40 per share and has a dividend yield of 1.7%. Jefferies Financial Group pays an annual dividend of $0.40 per share and has a dividend yield of 1.7%. Leucadia National pays out 24.2% of its earnings in the form of a dividend. Jefferies Financial Group pays out 24.2% 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.
Valuation & Earnings
This table compares Leucadia National and Jefferies Financial Group’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Leucadia National||$11.44 billion||0.71||$171.72 million||$1.65||14.22|
|Jefferies Financial Group||$11.44 billion||0.68||$171.72 million||$1.65||14.13|
Jefferies Financial Group is trading at a lower price-to-earnings ratio than Leucadia National, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
79.0% of Leucadia National shares are owned by institutional investors. Comparatively, 74.2% of Jefferies Financial Group shares are owned by institutional investors. 10.2% of Leucadia National shares are owned by company insiders. Comparatively, 10.0% of Jefferies Financial Group shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
This table compares Leucadia National and Jefferies Financial Group’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Jefferies Financial Group||7.60%||4.52%||0.97%|
Leucadia National beats Jefferies Financial Group on 7 of the 11 factors compared between the two stocks.
Leucadia National Company Profile
Leucadia National Corporation operates as a diversified holding company that focuses on financial service businesses and investments in the Americas, Europe, and Asia. Its services include equities research, sales, and trading; financing, securities lending, and other brokerage; wealth management; fixed income sales and trading; futures; equity capital markets, debt capital markets, and financial advisory; and asset management services. The company also provides online foreign exchange trading, contract for difference trading, spread betting, and related services. In addition, it develops and owns residential and mixed-use real estate properties in California, New York, Florida, Virginia, South Carolina, and Maine; provides capital solutions, investment sales advisory, and mortgage servicing for multifamily and commercial properties; and purchases automobile installment contracts, as well as owns and manages a portfolio of leases on used Harley-Davidson motorcycles. Further, it processes and markets fresh and chilled boxed beef, ground beef, beef by-products, consumer-ready beef and pork, and wet blue leather; oil and gas properties in the Bakken Shale oil field in North Dakota and Montana, and the Denver-Julesburg Basin in Wyoming; owns and operates 28 automobile dealerships; offers fixed wireless broadband services in Italy; manufactures and markets plastic netting and wood products; and mines gold and silver ores. The company was formerly known as Talcott National Corp. and changed its name to Leucadia National Corporation in June 1980. Leucadia National Corporation was founded in 1968 and is headquartered in New York, New York.
Jefferies Financial Group Company Profile
Jefferies Financial Group Inc., a financial services company, offers a range of products and services in investment banking, equities, fixed income, and wealth management in the Americas, Europe, and Asia. It engages in the debt capital market, equity capital market, merger and acquisition, private capital advisory, and restructuring and recapitalization businesses. The company also offers cash equities; electronic trading solutions, such as global algorithmic and portfolio trading solutions; equity derivatives, such as U.S. equity options, U.S. exchange-traded funds, and Europe equity derivatives, as well as trades in a range of convertible securities from large investment-grade issues to small private transactions; access to investors and logistics; and prime services. In addition, it provides fixed income products, such as government securities, mortgage and asset backed securities, corporate credits, sovereign and corporate fixed income securities, municipal securities, debt solutions, and foreign exchange. Further, the company offers asset management services; and wealth management services, such as investment advisory, financial planning, family office and institutional consulting, executive, and lending solutions. 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 1968 and is based in New York, New York.
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