Head to Head Analysis: Affirm (NASDAQ:AFRM) and Federal Agricultural Mortgage (NYSE:AGM)

Federal Agricultural Mortgage (NYSE:AGM) and Affirm (NASDAQ:AFRM) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their profitability, dividends, institutional ownership, earnings, valuation, risk and analyst recommendations.

Profitability

This table compares Federal Agricultural Mortgage and Affirm’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Federal Agricultural Mortgage	28.88%	19.16%	0.62%
Affirm	43.86%	43.38%	13.80%

Analyst Recommendations

This is a summary of recent recommendations for Federal Agricultural Mortgage and Affirm, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Federal Agricultural Mortgage	0	2	1	0	2.33
Affirm	0	7	25	1	2.82

Federal Agricultural Mortgage presently has a consensus target price of $255.00, indicating a potential upside of 46.25%. Affirm has a consensus target price of $95.96, indicating a potential upside of 45.51%. Given Federal Agricultural Mortgage’s higher probable upside, equities research analysts clearly believe Federal Agricultural Mortgage is more favorable than Affirm.

Volatility and Risk

Federal Agricultural Mortgage has a beta of 1.02, meaning that its share price is 2% more volatile than the S&P 500. Comparatively, Affirm has a beta of 3.74, meaning that its share price is 274% more volatile than the S&P 500.

Institutional & Insider Ownership

68.0% of Federal Agricultural Mortgage shares are owned by institutional investors. Comparatively, 69.3% of Affirm shares are owned by institutional investors. 1.9% of Federal Agricultural Mortgage shares are owned by company insiders. Comparatively, 10.6% of Affirm shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Federal Agricultural Mortgage and Affirm”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Federal Agricultural Mortgage	$467.76 million	4.04	$207.41 million	$18.90	9.23
Affirm	$4.26 billion	5.22	$1.93 billion	$5.76	11.45

Affirm has higher revenue and earnings than Federal Agricultural Mortgage. Federal Agricultural Mortgage is trading at a lower price-to-earnings ratio than Affirm, indicating that it is currently the more affordable of the two stocks.

Summary

Affirm beats Federal Agricultural Mortgage on 13 of the 15 factors compared between the two stocks.

About Federal Agricultural Mortgage

Federal Agricultural Mortgage Corporation, known as Farmer Mac, operates a secondary market that helps provide liquidity to lenders serving U.S. agriculture and rural communities. Established by Congress under the Agricultural Credit Act of 1987, the company purchases eligible loans and provides guarantees and other financing solutions to lending institutions. Farmer Mac’s offerings support loans for farms and ranches, rural utilities and infrastructure, and other eligible rural borrowers. Its programs also include financing tied to USDA-guaranteed loans.

About Affirm

Affirm Holdings, Inc. operates a financial technology platform that enables consumers to pay for purchases over time. Its services are offered at participating merchants’ checkout pages and through the Affirm app, where eligible customers can review payment options and manage purchases. The company’s products include installment loans with terms that vary by purchase and eligibility, as well as the Affirm Card, which lets users access Affirm payment options for eligible transactions. Affirm also provides merchants with payment and commerce tools designed to support checkout and customer purchases.