Upbound Group (NASDAQ:UPBD) & Nelnet (NYSE:NNI) Head to Head Contrast

Upbound Group (NASDAQ:UPBD) and Nelnet (NYSE:NNI) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, dividends, earnings, risk, analyst recommendations, valuation and profitability.

Earnings & Valuation

This table compares Upbound Group and Nelnet”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Upbound Group	$4.70 billion	0.20	$73.24 million	$1.54	10.45
Nelnet	$2.26 billion	1.97	$428.47 million	$8.36	14.89

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

Risk & Volatility

Upbound Group has a beta of 1.77, suggesting that its stock price is 77% more volatile than the S&P 500. Comparatively, Nelnet has a beta of 0.76, suggesting that its stock price is 24% less volatile than the S&P 500.

Dividends

Upbound Group pays an annual dividend of $1.56 per share and has a dividend yield of 9.7%. Nelnet pays an annual dividend of $1.32 per share and has a dividend yield of 1.1%. Upbound Group pays out 101.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Nelnet pays out 15.8% of its earnings in the form of a dividend. Upbound Group has increased its dividend for 5 consecutive years. Upbound Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional and Insider Ownership

90.3% of Upbound Group shares are held by institutional investors. Comparatively, 33.5% of Nelnet shares are held by institutional investors. 1.2% of Upbound Group shares are held by insiders. Comparatively, 40.3% of Nelnet shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Upbound Group and Nelnet, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Upbound Group	1	2	1	0	2.00
Nelnet	1	2	0	0	1.67

Upbound Group currently has a consensus target price of $28.00, suggesting a potential upside of 74.02%. Nelnet has a consensus target price of $140.00, suggesting a potential upside of 12.46%. Given Upbound Group’s stronger consensus rating and higher probable upside, equities analysts clearly believe Upbound Group is more favorable than Nelnet.

Profitability

This table compares Upbound Group and Nelnet’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Upbound Group	1.90%	34.53%	7.69%
Nelnet	14.35%	8.26%	2.11%

Summary

Upbound Group beats Nelnet on 10 of the 17 factors compared between the two stocks.

About Upbound Group

Upbound Group, Inc. leases household durable goods to customers on a lease-to-own basis in the United States, Puerto Rico, and Mexico. It operates through four segments: Rent-A-Center, Acima, Mexico, and Franchising. The company's brands, such as Rent-A-Center and Acima that facilitate consumer transactions across a range of store-based and virtual channels. It offers furniture comprising mattresses, tires, consumer electronics, appliances, tools, handbags, computers, smartphones, and accessories. It also provides merchandise on an installment sales basis; and the lease-to-own transaction to consumers who do not qualify for traditional financing, the lease to-own transaction through staffed or unstaffed kiosks located in third-party retailer's locations, and other virtual options. It operates retail installment sales stores under the Get It Now and Home Choice names; lease-to-own and franchised lease-to-own stores under the Rent-A-Centre, ColorTyme, and RimTyme names; and company-owned stores and e-commerce platform through rentacenter.com. The company was formerly known as Rent-A-Center, Inc. and changed its name to Upbound Group, Inc. in February 2023. Upbound Group, Inc. was founded in 1960 and is based in Plano, Texas.

About Nelnet

Nelnet, Inc. engages in loan servicing, communications, education technology, services, and payment processing businesses worldwide. The Loan Servicing and Systems segment provides loan conversion, application processing, borrower updates, customer service, payment processing, due diligence procedures, funds management reconciliation, and claim processing services. This segment also offers student loan servicing software; business process outsourcing services specialized in contact center management, such as inbound calls, outreach campaigns and sales, and interacting with customers through multi-channels, and processing and technology services. The Education Technology Services and Payments segment provides financial management services; school information system software; website design and cost-effective admissions software; FACTS Giving, a donation platform; and customized professional development and coaching services, educational instruction services, and technology products that aid in teacher and student evaluations. This segment also offers tuition payment plans, and service and technology for student billings, payments, and refunds; solutions for in-person, online, and mobile payment experiences on campus; payment processing services, such as credit card and electronic transfer; faith community, giving, and learning management services and technologies; and an integrated commerce payment platform, financial management, and tuition payment plan services, as well as a school management platform that provides administrative, information and financial management, and communication functions for K-12 schools. The Asset Generation and Management segment acquires, manages, and owns loan assets. The Nelnet Bank segment operates as an internet industrial bank. It also offers investment advisory, insurance, and reinsurance services, as well as engages in real estate investment business. The company was incorporated in 1977 and is headquartered in Lincoln, Nebraska.