FlexShopper (FPAY) and Rent-A-Center (RCII) Financial Contrast

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FlexShopper (NASDAQ:FPAY) and Rent-A-Center (NASDAQ:RCII) are both small-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, earnings, institutional ownership, analyst recommendations, profitability, dividends and risk.

Analyst Ratings

This is a summary of current recommendations and price targets for FlexShopper and Rent-A-Center, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
FlexShopper 0 0 0 0 N/A
Rent-A-Center 1 5 0 0 1.83

Rent-A-Center has a consensus target price of $10.50, suggesting a potential downside of 26.93%. Given Rent-A-Center’s higher possible upside, analysts clearly believe Rent-A-Center is more favorable than FlexShopper.

Earnings and Valuation

This table compares FlexShopper and Rent-A-Center’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
FlexShopper $67.05 million 0.06 -$8.33 million N/A N/A
Rent-A-Center $2.70 billion 0.28 $6.65 million ($0.54) -26.61

Rent-A-Center has higher revenue and earnings than FlexShopper.

Risk and Volatility

FlexShopper has a beta of 0.15, meaning that its stock price is 85% less volatile than the S&P 500. Comparatively, Rent-A-Center has a beta of 0.6, meaning that its stock price is 40% less volatile than the S&P 500.

Profitability

This table compares FlexShopper and Rent-A-Center’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
FlexShopper -13.86% N/A -35.85%
Rent-A-Center 0.61% -3.42% -0.63%

Institutional and Insider Ownership

9.5% of FlexShopper shares are held by institutional investors. Comparatively, 94.2% of Rent-A-Center shares are held by institutional investors. 15.1% of FlexShopper shares are held by company insiders. Comparatively, 0.9% of Rent-A-Center shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Summary

Rent-A-Center beats FlexShopper on 8 of the 10 factors compared between the two stocks.

About FlexShopper

FlexShopper, Inc., through its wholly owned subsidiary, FlexShopper, LLC, provides various types of durable goods to consumers on a lease-to-own basis (LTO) to consumers of third party retailers and e-tailers. It offers products through FlexShopper.com, an LTO e-commerce marketplace; e-commerce sites and in-store terminals by utilizing FlexShopper's LTO payment method; and facilitation of LTO transactions with retailers. The company was formerly known as Anchor Funding Services, Inc. and changed its name to FlexShopper, Inc. in October 2013. FlexShopper, Inc. was founded in 2003 and is based in Boca Raton, Florida.

About Rent-A-Center

Rent-A-Center, Inc., together with its subsidiaries, leases household durable goods to customers on a rent-to-own basis. The company operates through four segments: Core U.S., Acceptance Now, Mexico, and Franchising. It offers durable products, such as consumer electronics; appliances; computers, including tablets; smartphones; and furniture, including accessories under rental purchase agreements. The company also provides merchandise on an installment sales basis; and offers the rent-to-own transaction to consumers who do not qualify for financing from the traditional retailer through kiosks within retailer's locations. It operates retail installment sales stores under the Get It Now and Home Choice names; and rent-to-own and franchised rent-to-own stores under the Rent-A-Centre, ColorTyme, and RimTyme names. As of December 31, 2017, the company owned and operated approximately 2,381 stores in the United States, Canada, and Puerto Rico, including 45 retail installment sales stores; 1,106 Acceptance Now staffed locations in 42 states and Puerto Rico; 125 Acceptance Now Direct locations; and 131 stores in Mexico, as well as franchised 225 rent-to-own stores in 31 states under the Rent-A-Center, ColorTyme, and RimTyme names. Rent-A-Center, Inc. was founded in 1986 and is headquartered in Plano, Texas.

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