Financial Contrast: Lendingclub (NASDAQ:HAPN) vs. Consumer Portfolio Services (NASDAQ:CPSS)

Consumer Portfolio Services (NASDAQ:CPSS) and Lendingclub (NASDAQ:HAPN) are both small-cap finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, dividends, risk, earnings, profitability and valuation.

Profitability

This table compares Consumer Portfolio Services and Lendingclub’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Consumer Portfolio Services	4.78%	6.91%	0.54%
Lendingclub	18.67%	12.92%	1.66%

Earnings & Valuation

This table compares Consumer Portfolio Services and Lendingclub”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Consumer Portfolio Services	$434.47 million	0.47	$19.33 million	$0.92	10.05
Lendingclub	$998.85 million	1.68	$135.68 million	$1.66	8.74

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

Analyst Ratings

This is a summary of recent ratings and price targets for Consumer Portfolio Services and Lendingclub, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Consumer Portfolio Services	0	1	0	0	2.00
Lendingclub	0	1	2	0	2.67

Lendingclub has a consensus target price of $25.00, suggesting a potential upside of 72.29%. Given Lendingclub’s stronger consensus rating and higher possible upside, analysts clearly believe Lendingclub is more favorable than Consumer Portfolio Services.

Insider & Institutional Ownership

47.6% of Consumer Portfolio Services shares are held by institutional investors. Comparatively, 74.1% of Lendingclub shares are held by institutional investors. 63.8% of Consumer Portfolio Services shares are held by company insiders. Comparatively, 3.3% of Lendingclub shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Risk & Volatility

Consumer Portfolio Services has a beta of 1.14, indicating that its stock price is 14% more volatile than the S&P 500. Comparatively, Lendingclub has a beta of 1.88, indicating that its stock price is 88% more volatile than the S&P 500.

Summary

Lendingclub beats Consumer Portfolio Services on 12 of the 14 factors compared between the two stocks.

About Consumer Portfolio Services

Consumer Portfolio Services, Inc. operates as a specialty finance company in the United States. It is involved in the purchase and service of retail automobile contracts originated by franchised automobile dealers and select independent dealers in the sale of new and used automobiles, light trucks, and passenger vans. The company, through its automobile contract purchases, offers indirect financing to the customers of dealers with limited credit histories or past credit problems. It also serves as an alternative source of financing for dealers, facilitating sales to customers who are not able to obtain financing from commercial banks, credit unions, and the captive finance companies. In addition, the company acquires installment purchase contracts in merger and acquisition transactions; purchases immaterial amounts of vehicle purchase money loans from non-affiliated lenders. It services its automobile contracts through its branches in California, Nevada, Virginia, Florida, and Illinois. The company was incorporated in 1991 and is based in Las Vegas, Nevada.

About Lendingclub

LendingClub Corporation, operates as a bank holding company for LendingClub Bank, National Association that provides range of financial products and services through a technology-driven platform in the United States. The company provides commercial and industrial, commercial real estate, small business, and equipment loans, as well as leases equipment; and unsecured personal and auto, patient finance, and education finance loans. It also operates an online lending marketplace platform that connects borrowers and investors. LendingClub Corporation was incorporated in 2006 and is headquartered in San Francisco, California.