LM Funding America (NASDAQ:LMFA) and Qudian (NYSE:QD) are both small-cap finance companies, but which is the better business? We will compare the two companies based on the strength of their dividends, profitability, valuation, institutional ownership, risk, earnings and analyst recommendations.

Earnings and Valuation

This table compares LM Funding America and Qudian’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
LM Funding America $4.39 million 0.17 -$8.62 million N/A N/A
Qudian $733.96 million 2.31 $332.67 million N/A N/A

Qudian has higher revenue and earnings than LM Funding America.

Profitability

This table compares LM Funding America and Qudian’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
LM Funding America -72.06% -274.08% -138.70%
Qudian 30.49% 22.42% 12.53%

Analyst Recommendations

This is a summary of recent ratings and recommmendations for LM Funding America and Qudian, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
LM Funding America 0 0 0 0 N/A
Qudian 0 5 0 0 2.00

Qudian has a consensus target price of $17.75, suggesting a potential upside of 246.00%. Given Qudian’s higher probable upside, analysts plainly believe Qudian is more favorable than LM Funding America.

Risk and Volatility

LM Funding America has a beta of 2.47, suggesting that its share price is 147% more volatile than the S&P 500. Comparatively, Qudian has a beta of 0.56, suggesting that its share price is 44% less volatile than the S&P 500.

Insider & Institutional Ownership

9.7% of LM Funding America shares are held by institutional investors. Comparatively, 4.3% of Qudian shares are held by institutional investors. 38.6% of LM Funding America shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

Qudian beats LM Funding America on 7 of the 10 factors compared between the two stocks.

About LM Funding America

LM Funding America, Inc., through its subsidiary, LM Funding, LLC, operates as a specialty finance company. It provides funding to nonprofit community associations (Associations) primarily located in the state of Florida, as well as in the states of Washington, Colorado, and Illinois. The company offers funding to Associations by purchasing their rights under delinquent accounts that are selected by the Associations arising from unpaid Association assessments. It is also involved in the business of purchasing delinquent accounts on various terms tailored to suit each Association's financial needs, including under its New Neighbor Guaranty program. The company was founded in 2008 and is based in Tampa, Florida.

About Qudian

Qudian Inc. provides online small consumer credit products in the People's Republic of China. It uses big data-enabled technologies, including artificial intelligence and machine learning to transform the consumer finance experience. The company offers cash credit products, such as cash short-term unsecured lines of credit, which are distributed in digital form; and merchandise credit products to finance borrowers' direct purchase of merchandise offered on its marketplace on installment basis, as well as budget auto financing products. Qudian Inc. was founded in 2014 and is headquartered in Beijing, the People's Republic of China.

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