Comparing FirstCash (NYSE:FCFS) and PHH (PHH)

PHH (NYSE: PHH) and FirstCash (NYSE:FCFS) are both finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, earnings, risk, analyst recommendations, profitability, dividends and valuation.

Insider & Institutional Ownership

93.3% of PHH shares are owned by institutional investors. Comparatively, 95.7% of FirstCash shares are owned by institutional investors. 2.5% of PHH shares are owned by company insiders. Comparatively, 2.8% of FirstCash shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Valuation & Earnings

This table compares PHH and FirstCash’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
PHH $622.00 million 0.58 -$202.00 million ($5.74) -1.93
FirstCash $1.09 billion 2.93 $60.12 million $2.34 28.91

FirstCash has higher revenue and earnings than PHH. PHH is trading at a lower price-to-earnings ratio than FirstCash, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current recommendations and price targets for PHH and FirstCash, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
PHH 0 2 1 0 2.33
FirstCash 0 2 5 0 2.71

PHH currently has a consensus price target of $15.83, indicating a potential upside of 42.64%. FirstCash has a consensus price target of $64.00, indicating a potential downside of 5.40%. Given PHH’s higher probable upside, research analysts plainly believe PHH is more favorable than FirstCash.

Volatility & Risk

PHH has a beta of 1.85, indicating that its share price is 85% more volatile than the S&P 500. Comparatively, FirstCash has a beta of 0.79, indicating that its share price is 21% less volatile than the S&P 500.

Profitability

This table compares PHH and FirstCash’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
PHH -71.84% -27.98% -9.33%
FirstCash 6.41% 8.45% 5.91%

Dividends

FirstCash pays an annual dividend of $0.80 per share and has a dividend yield of 1.2%. PHH does not pay a dividend. FirstCash pays out 34.2% of its earnings in the form of a dividend.

Summary

FirstCash beats PHH on 12 of the 15 factors compared between the two stocks.

PHH Company Profile

PHH Corporation is a standalone mortgage company. The Company provides outsourced mortgage banking services to a range of clients, including financial institutions and real estate brokers throughout the United States, and is focused on originating, selling, servicing and subservicing residential mortgage loans through its subsidiary, PHH Mortgage Corporation and its subsidiaries. It operates through two segments: Mortgage Production and Mortgage Servicing. The Mortgage Production segment provides mortgage loan origination services and sells mortgage loans. The Mortgage Servicing segment performs servicing activities for loans originated by the Company and mortgage servicing rights purchased from others, and acts as a subservicer for certain clients that own the underlying mortgage servicing rights. The Mortgage Production segment provides private label mortgage services to financial institutions and real estate brokers, and sources mortgage loans through its retail platform.

FirstCash Company Profile

FirstCash, Inc., formerly First Cash Financial Services, Inc., is an operator of retail-based pawn stores in the United States and Latin America. The Company’s primary business is the operation of full-service pawn stores, which make small pawn loans secured by personal property, such as consumer electronics, jewelry, power tools, household appliances, sporting goods and musical instruments. The Company’s operates through two segments: the U.S. operations segment and the Latin America operations segment. The U.S. operations segment consists of all pawn and consumer loan operations in the United States and the Latin America operations segment consists of all pawn and consumer loan operations in Latin America, which includes operations in Mexico, Guatemala and El Salvador. In addition, some of the Company’s pawn stores offer small unsecured consumer loans or credit services products. The Company also operates consumer finance stores in Texas and Mexico.

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