Analyzing Vroom (NASDAQ:VRM) and Enova International (NYSE:ENVA)

Enova International (NYSE:ENVA) and Vroom (NASDAQ:VRM) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, risk, dividends, profitability, earnings, institutional ownership and valuation.

Analyst Recommendations

This is a summary of recent ratings for Enova International and Vroom, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Enova International	0	1	8	0	2.89
Vroom	1	0	0	0	1.00

Enova International currently has a consensus target price of $239.00, suggesting a potential upside of 42.09%. Given Enova International’s stronger consensus rating and higher probable upside, analysts clearly believe Enova International is more favorable than Vroom.

Valuation and Earnings

This table compares Enova International and Vroom”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Enova International	$3.15 billion	1.31	$308.39 million	$14.52	11.58
Vroom	$178.83 million	0.20	-$7.96 million	($11.12)	-0.61

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

Institutional and Insider Ownership

89.4% of Enova International shares are owned by institutional investors. Comparatively, 25.8% of Vroom shares are owned by institutional investors. 8.4% of Enova International shares are owned by insiders. Comparatively, 2.9% of Vroom shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Volatility & Risk

Enova International has a beta of 1.36, suggesting that its share price is 36% more volatile than the S&P 500. Comparatively, Vroom has a beta of 1.36, suggesting that its share price is 36% more volatile than the S&P 500.

Profitability

This table compares Enova International and Vroom’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Enova International	10.47%	27.25%	5.60%
Vroom	-32.38%	-47.65%	-5.59%

Summary

Enova International beats Vroom on 12 of the 12 factors compared between the two stocks.

About Enova International

Enova International, Inc., a technology and analytics company, provides online financial services in the United States, Brazil, and internationally. The company provides installment loans; line of credit accounts; CSO programs, including arranging loans with independent third-party lenders and assisting in the preparation of loan applications and loan documents; and bank programs, such as marketing services and loan servicing for near-prime unsecured consumer installment loan. It offers money transfer services. It markets its financing products under the CashNetUSA, NetCredit, OnDeck, Headway Capital, Simplic, and Pangea names. The company was founded in 2003 and is headquartered in Chicago, Illinois.

About Vroom

Vroom, Inc. operates as an automotive finance company. The company offers vehicle financing to its customers through third party dealers under the UACC brand. It also provides artificial intelligence powered analytics and digital services to dealers, automotive financial services companies, and others in the automotive industry for automotive retail. The company was formerly known as Auto America, Inc. and changed its name to Vroom, Inc. in July 2015. Vroom, Inc. was incorporated in 2012 and is based in Houston, Texas.