Contrasting Home Capital Group (OTCMKTS:HMCBF) & Guild (NYSE:GHLD)

Home Capital Group (OTCMKTS:HMCBF) and Guild (NYSE:GHLD) are both financial services companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, dividends, valuation, profitability, institutional ownership, risk and analyst recommendations.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Home Capital Group and Guild, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Home Capital Group	0	0	0	0	N/A
Guild	1	1	2	0	2.25

Guild has a consensus target price of $15.25, indicating a potential upside of 8.93%. Given Guild’s higher probable upside, analysts plainly believe Guild is more favorable than Home Capital Group.

Institutional & Insider Ownership

37.0% of Home Capital Group shares are owned by institutional investors. Comparatively, 17.5% of Guild shares are owned by institutional investors. 78.0% of Guild 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.

Profitability

This table compares Home Capital Group and Guild’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Home Capital Group	N/A	N/A	N/A
Guild	-5.95%	3.57%	1.27%

Valuation & Earnings

This table compares Home Capital Group and Guild’s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Home Capital Group	N/A	N/A	N/A	$4.06	8.00
Guild	$655.19 million	1.33	-$39.01 million	($0.65)	-22.00

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

Summary

Guild beats Home Capital Group on 6 of the 10 factors compared between the two stocks.

About Home Capital Group

Home Capital Group Inc., through its subsidiary, Home Trust Company, provides residential and non-residential mortgage lending, securitization of residential mortgage products, consumer lending, and credit card services in Canada. The company provides various lending and savings solutions. It offers deposits through brokers and financial planners under the Oaken Financial brand. The company also provides credit card and line of credit services, include Equityline Visa product, a home equity line of credit that is secured by residential property; and cash-secured and unsecured credit card products. In addition, it offers consumer retail lending services for durable household goods, such as water heaters and larger-ticket home improvement items; and consumer loans. Further, the company manages a treasury portfolio. The company was founded in 1986 and is based in Toronto, Canada. As of August 31, 2023, Home Capital Group Inc. operates as a subsidiary of 1000355080 Ontario Inc.

About Guild

Guild Holdings Company originates, sells, and services residential mortgage loans in the United States. It operates in two segments, Origination and Servicing. The company offers residential mortgages through retail and correspondent channels. Guild Holdings Company was incorporated in 1960 and is headquartered in San Diego, California.