Critical Comparison: Medallion Financial (NASDAQ:MFIN) & Digihost Technology (NASDAQ:DGHI)

Medallion Financial (NASDAQ:MFIN) and Digihost Technology (NASDAQ:DGHI) are both small-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, risk, institutional ownership, profitability, earnings, dividends and valuation.

Insider and Institutional Ownership

40.6% of Medallion Financial shares are held by institutional investors. Comparatively, 1.9% of Digihost Technology shares are held by institutional investors. 22.4% of Medallion Financial 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.

Risk and Volatility

Medallion Financial has a beta of 2.17, suggesting that its stock price is 117% more volatile than the S&P 500. Comparatively, Digihost Technology has a beta of 5.41, suggesting that its stock price is 441% more volatile than the S&P 500.

Profitability

This table compares Medallion Financial and Digihost Technology’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Medallion Financial	14.97%	10.44%	1.65%
Digihost Technology	-25.38%	-20.93%	-15.75%

Earnings and Valuation

This table compares Medallion Financial and Digihost Technology’s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Medallion Financial	$194.70 million	0.94	$55.08 million	$2.12	3.71
Digihost Technology	$34.97 million	0.86	-$21.89 million	($0.29)	-3.52

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

Analyst Ratings

This is a breakdown of recent ratings and target prices for Medallion Financial and Digihost Technology, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Medallion Financial	0	0	0	0	N/A
Digihost Technology	0	0	1	0	3.00

Digihost Technology has a consensus price target of $2.50, indicating a potential upside of 138.10%. Given Digihost Technology’s higher possible upside, analysts plainly believe Digihost Technology is more favorable than Medallion Financial.

Summary

Medallion Financial beats Digihost Technology on 10 of the 13 factors compared between the two stocks.

About Medallion Financial

Medallion Financial Corp., together with its subsidiaries, operates as a specialty finance company in the United States. It operates in four segments: Recreation Lending, Home Improvement Lending, Commercial Lending, and Taxi Medallion Lending. The company offers loans that finance consumer purchases of recreational vehicles, boats, and other consumer recreational equipment; consumer financing for window, siding, and roof replacement, swimming pool installations, and other home improvement projects; senior and subordinated loans for the purchase of equipment and related assets necessary to open a new business, or purchase or improvement of an existing business; and taxi medallion loans to individuals and small to mid-size businesses. It also provides debt, mezzanine, and equity investment capital to companies in various commercial industries; and raises deposits and conducts other banking activities. Medallion Financial Corp. was incorporated in 1995 and is headquartered in New York City, New York.

About Digihost Technology

Digihost Technology Inc. operates as a blockchain technology company in the United States and Canada. The company operates through Cryptocurrency Mining, Sales of Energy, and Colocation Services segments. It also mines for cryptocurrency; and supplies energy from power plants. Digihost Technology Inc. was incorporated in 2017 and is headquartered in Houston, Texas.