Analyzing Bread Financial (NYSE:BFH) & Oportun Financial (NASDAQ:OPRT)

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

Risk and Volatility

Oportun Financial has a beta of 1.25, suggesting that its stock price is 25% more volatile than the S&P 500. Comparatively, Bread Financial has a beta of 1.15, suggesting that its stock price is 15% more volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Oportun Financial	2.05%	13.41%	1.66%
Bread Financial	11.19%	17.24%	2.56%

Valuation and Earnings

This table compares Oportun Financial and Bread Financial”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Oportun Financial	$956.70 million	0.44	$25.25 million	$0.40	22.97
Bread Financial	$3.96 billion	0.97	$518.00 million	$12.68	7.86

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

Institutional & Insider Ownership

82.7% of Oportun Financial shares are owned by institutional investors. Comparatively, 99.5% of Bread Financial shares are owned by institutional investors. 1.6% of Oportun Financial shares are owned by insiders. Comparatively, 1.3% of Bread Financial shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Oportun Financial and Bread Financial, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Oportun Financial	0	3	2	0	2.40
Bread Financial	1	7	8	0	2.44

Oportun Financial presently has a consensus target price of $7.75, suggesting a potential downside of 15.67%. Bread Financial has a consensus target price of $112.21, suggesting a potential upside of 12.53%. Given Bread Financial’s stronger consensus rating and higher possible upside, analysts clearly believe Bread Financial is more favorable than Oportun Financial.

Summary

Bread Financial beats Oportun Financial on 11 of the 14 factors compared between the two stocks.

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.

About Bread Financial

Bread Financial Holdings, Inc. provides tech-forward payment and lending solutions to customers and consumer-based industries in North America. It offers credit card and other loans financing services, including risk management solutions, account origination, and funding services for private label and co-brand credit card programs, as well as through Bread partnerships; and Comenity-branded general purpose cash-back credit. The company also manages and services the loans it originates for private label, co-brand, and general-purpose credit card programs, and installment loans and split-pay products; and provides marketing, and data and analytics services. In addition, it offers an enhanced digital suite that includes a unified software development kit, which provides access to its suite of products, as well as promotes credit payment options earlier in the shopping experience. Further, the company through Bread, a digital payments platform and robust suite of application programming interfaces allows merchants and partners to integrate online point-of-sale financing and other digital payment products. It offers its products under the Bread CashbackTM, Bread PayTM, and Bread SavingsTM brands. The company was formerly known as Alliance Data Systems Corporation and changed its name to Bread Financial Holdings, Inc. in March 2022. Bread Financial Holdings, Inc. was incorporated in 1995 and is headquartered in Columbus, Ohio.