Lendingclub (NASDAQ:HAPN) & Atlanticus (NASDAQ:ATLC) Critical Contrast

Atlanticus (NASDAQ:ATLC) and Lendingclub (NASDAQ:HAPN) are both finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their earnings, analyst recommendations, institutional ownership, dividends, risk, valuation and profitability.

Analyst Ratings

This is a summary of current recommendations for Atlanticus and Lendingclub, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Atlanticus	0	2	5	1	2.88
Lendingclub	0	1	2	0	2.67

Atlanticus currently has a consensus target price of $126.00, suggesting a potential upside of 26.21%. Lendingclub has a consensus target price of $25.00, suggesting a potential upside of 29.21%. Given Lendingclub’s higher possible upside, analysts clearly believe Lendingclub is more favorable than Atlanticus.

Risk and Volatility

Atlanticus has a beta of 2.11, indicating that its share price is 111% more volatile than the S&P 500. Comparatively, Lendingclub has a beta of 1.91, indicating that its share price is 91% more volatile than the S&P 500.

Earnings and Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Atlanticus	$1.97 billion	0.77	$122.20 million	$6.70	14.90
Lendingclub	$998.85 million	2.24	$135.68 million	$1.66	11.66

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

Profitability

This table compares Atlanticus and Lendingclub’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Atlanticus	5.86%	23.43%	2.17%
Lendingclub	18.67%	12.92%	1.66%

Insider & Institutional Ownership

14.2% of Atlanticus shares are owned by institutional investors. Comparatively, 74.1% of Lendingclub shares are owned by institutional investors. 51.0% of Atlanticus shares are owned by company insiders. Comparatively, 3.3% of Lendingclub shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Summary

Atlanticus beats Lendingclub on 10 of the 15 factors compared between the two stocks.

About Atlanticus

Atlanticus Holdings Corporation, a financial technology company, provides credit and related financial services and products to customers the United States. It operates in two segments, Credit as a Service, and Auto Finance. The Credit as a Service segment originates a range of consumer loan products, such as private label and general purpose credit cards originated by lenders through various channels, including retail and healthcare, direct mail solicitation, digital marketing, and partnerships with third parties; and offers credit to their customers for the purchase of various goods and services, including consumer electronics, furniture, elective medical procedures, healthcare, and home-improvements by partnering with retailers, healthcare providers, and other service providers. This segment also offers loan servicing, such as risk management and customer service outsourcing for third parties; and engages in testing and investment activities in consumer finance technology platforms. The Auto Finance segment purchases and/or services loans secured by automobiles from or for a pre-qualified network of independent automotive dealers and automotive finance companies in the buy-here, pay-here, and used car business. This segment also provides floor plan financing and installment lending products. It also invests in and services portfolios of credit card receivables. The company was founded in 1996 and is headquartered in Atlanta, Georgia.

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.