Financial Contrast: Rithm Capital (NYSE:RITM) and Oportun Financial (NASDAQ:OPRT)

Rithm Capital (NYSE:RITM) and Oportun Financial (NASDAQ:OPRT) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, valuation, analyst recommendations, institutional ownership, earnings, dividends and profitability.

Analyst Ratings

This is a summary of current ratings and recommmendations for Rithm Capital and Oportun Financial, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Rithm Capital	0	0	8	1	3.11
Oportun Financial	0	3	2	0	2.40

Rithm Capital presently has a consensus price target of $14.25, indicating a potential upside of 25.11%. Oportun Financial has a consensus price target of $9.33, indicating a potential upside of 51.27%. Given Oportun Financial’s higher possible upside, analysts clearly believe Oportun Financial is more favorable than Rithm Capital.

Risk and Volatility

Rithm Capital has a beta of 1.3, suggesting that its stock price is 30% more volatile than the S&P 500. Comparatively, Oportun Financial has a beta of 1.33, suggesting that its stock price is 33% more volatile than the S&P 500.

Insider and Institutional Ownership

44.9% of Rithm Capital shares are owned by institutional investors. Comparatively, 82.7% of Oportun Financial shares are owned by institutional investors. 0.4% of Rithm Capital shares are owned by insiders. Comparatively, 9.3% of Oportun Financial shares are owned by 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.

Earnings and Valuation

This table compares Rithm Capital and Oportun Financial”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Rithm Capital	$5.21 billion	1.16	$931.50 million	$1.30	8.76
Oportun Financial	$1.00 billion	0.27	-$78.68 million	($0.20)	-30.85

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

Profitability

This table compares Rithm Capital and Oportun Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Rithm Capital	16.72%	18.89%	2.83%
Oportun Financial	-0.47%	13.15%	1.45%

Summary

Rithm Capital beats Oportun Financial on 11 of the 15 factors compared between the two stocks.

About Rithm Capital

Rithm Capital Corp. operates as an asset manager focused on real estate, credit, and financial services. It operates through Origination and Servicing, Investment Portfolio, Mortgage Loans Receivable, and Asset Management segments. Its investment portfolio primarily comprises of mortgage servicing rights (MSR), and MSR financing receivables, title, appraisal and property preservation, excess MSRs, and services advance investments; real estate securities, call rights, SFR properties, and residential mortgage loans; consumer and business purpose loans; and asset management related investments. The company qualifies as a real estate investment trust for federal income tax purposes. It generally would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. The company was formerly known as New Residential Investment Corp. and changed its name to Rithm Capital Corp. in August 2022. Rithm Capital Corp. was incorporated in 2011 and is based in New York, New York.

About Oportun Financial

Oportun Financial Corporation provides financial services. The company offers personal loans and credit cards. It serves customers through online and over the phone, as well as through retail and Lending as a Service partner locations. The company was founded in 2005 and is headquartered in San Carlos, California.