Barron's and GHL

Last week (feb 19th) I discussed why I like GHL over LAZ. Let me repeat what I wrote when comparing GHL and LAZ:

"* EPS is forecast much higher: 80% vs 50%
* Sales growth is forecast to be higher: 48% vs 32%
* EPS upside is much higher: analyst ranges call for up to 150% growth vs 65%

Here is what I see:GHL was founded by former Morgan Stanley’s top bankers. This is a trend: big brokerages are losing all of their top talent to boutique shops where the ownership opportunities (and upside) is much higher). Greenhill is one such boutique.
Margins are up 5.2% y/y, 10% q/q. Sales are growing 50%, current PE is 42, and earnings grew 70%. Revenue and earnings are accelerating."

Barron's is right up to a point. GHL is valued much more than LAZ. And there are great reasons why:
LAZ is losing sales (down 14%) whereas GHL is doubling
LAZ is sitting on a mountain of debt almost equal to it's sales ($1.2B). GHL is debt free
LAZ has a lower margin (30% vs 40% for GHL)
LAZ is built on disgruntled employees. GHL is building with excited employees. GHL is cherry picking its team.

It's the classic small cap vs big cap valuation.
The small cap company is growing almost 2X so.....it's P/E is 2X.
And $100M in upside means a hell of a lot more to GHL than it does to LAZ.

At the moment LAZ is playing in many big deals - Time Warner & Disney, for example.
GHL deals are smaller but notable: Maytag, 7-11.

I am assessing that there will be plenty of deals sloshing around.
Plus, there is a reason why bankers are valuing one of their own this highly.