Head-To-Head Contrast: Lufax (NYSE:LU) & PROG (NYSE:PRG)

Lufax (NYSE:LU) and PROG (NYSE:PRG) are both small-cap finance companies, but which is the better investment? We will compare the two companies based on the strength of their analyst recommendations, risk, profitability, dividends, valuation, institutional ownership and earnings.

Volatility and Risk

Lufax has a beta of 0.79, meaning that its share price is 21% less volatile than the S&P 500. Comparatively, PROG has a beta of 1.79, meaning that its share price is 79% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Lufax and PROG, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lufax	2	0	1	0	1.67
PROG	0	3	6	1	2.80

Lufax currently has a consensus price target of $2.00, suggesting a potential upside of 26.98%. PROG has a consensus price target of $49.44, suggesting a potential upside of 12.67%. Given Lufax’s higher probable upside, analysts clearly believe Lufax is more favorable than PROG.

Insider and Institutional Ownership

69.1% of Lufax shares are owned by institutional investors. Comparatively, 97.9% of PROG shares are owned by institutional investors. 3.7% of PROG shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Dividends

Lufax pays an annual dividend of $0.12 per share and has a dividend yield of 7.6%. PROG pays an annual dividend of $0.56 per share and has a dividend yield of 1.3%. Lufax pays out -15.4% of its earnings in the form of a dividend. PROG pays out 15.5% 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. PROG has increased its dividend for 2 consecutive years. Lufax is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation & Earnings

This table compares Lufax and PROG”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Lufax	$23.11 billion	0.06	-$291.79 million	($0.78)	-2.02
PROG	$2.41 billion	0.73	$146.79 million	$3.62	12.12

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

Profitability

This table compares Lufax and PROG’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Lufax	N/A	N/A	N/A
PROG	5.57%	21.88%	9.15%

Summary

PROG beats Lufax on 14 of the 18 factors compared between the two stocks.

About Lufax

Lufax Holding Ltd operates as a financial service empowering institution for small and micro businesses in China. The company offers loan products, including general unsecured loans and secured loans, as well as consumer finance loans. It also provides wealth management products, such as asset management plans, mutual fund products, private investment fund products, and trust products. The company was founded in 2005 and is headquartered in Shanghai, China.

About PROG

PROG Holdings, Inc. (NYSE:PRG) is a financial technology holding company based in Salt Lake City, Utah with three business segments: Progressive Leasing, which offers lease-to-own transactions primarily to credit-challenged consumers through e-commerce and point-of-sale retail partners, via online, mobile, and in-store solutions; Vive Financial, which provides consumers who may not qualify for traditional prime lending with a variety of second-look, revolving credit products through private label and branded credit cards; and Four Technologies, which provides consumers of all credit backgrounds Buy Now, Pay Later (BNPL) options through four interest-free installments via its platform, Four.