LendingClub Corporation (NYSE: LC) and First Cash (NYSE:FCFS) are both financials companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, risk, earnings, institutional ownership, analyst recommendations and valuation.

Dividends

First Cash pays an annual dividend of $0.80 per share and has a dividend yield of 1.2%. LendingClub Corporation does not pay a dividend. First Cash pays out 34.2% of its earnings in the form of a dividend.

Institutional & Insider Ownership

87.9% of LendingClub Corporation shares are held by institutional investors. Comparatively, 94.8% of First Cash shares are held by institutional investors. 11.4% of LendingClub Corporation shares are held by company insiders. Comparatively, 2.8% of First Cash shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares LendingClub Corporation and First Cash’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
LendingClub Corporation $495.47 million 3.58 -$145.96 million ($0.23) -18.61
First Cash $1.09 billion 2.87 $60.12 million $2.34 28.33

First Cash has higher revenue and earnings than LendingClub Corporation. LendingClub Corporation is trading at a lower price-to-earnings ratio than First Cash, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current ratings and recommmendations for LendingClub Corporation and First Cash, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
LendingClub Corporation 0 6 9 0 2.60
First Cash 0 2 5 0 2.71

LendingClub Corporation presently has a consensus price target of $6.95, suggesting a potential upside of 62.30%. First Cash has a consensus price target of $64.00, suggesting a potential downside of 3.47%. Given LendingClub Corporation’s higher possible upside, equities analysts plainly believe LendingClub Corporation is more favorable than First Cash.

Profitability

This table compares LendingClub Corporation and First Cash’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
LendingClub Corporation -17.19% -9.06% -1.73%
First Cash 6.41% 8.45% 5.91%

Summary

First Cash beats LendingClub Corporation on 9 of the 14 factors compared between the two stocks.

LendingClub Corporation Company Profile

LendingClub Corporation provides online marketplace to connect borrowers and investors. Consumers and small business owners borrow through Lending Club. Investors use Lending Club to earn risk-adjusted returns from an asset class that has been closed to many investors and only available on a limited basis to large institutional investors. Its technology automates aspects of operations, including the borrower application process, data gathering, credit decisioning and scoring, loan funding, investing and servicing, regulatory compliance and fraud detection. Its platform offers analytical tools and data to enable investors to make decisions and assess their portfolios. Its technology platform has allowed it to expand its offerings from personal loans to include small business loans, and to expand investor classes from individuals to institutions and create various investment vehicles.

First Cash Company Profile

FirstCash, Inc., formerly First Cash Financial Services, Inc., is an operator of retail-based pawn stores in the United States and Latin America. The Company’s primary business is the operation of full-service pawn stores, which make small pawn loans secured by personal property, such as consumer electronics, jewelry, power tools, household appliances, sporting goods and musical instruments. The Company’s operates through two segments: the U.S. operations segment and the Latin America operations segment. The U.S. operations segment consists of all pawn and consumer loan operations in the United States and the Latin America operations segment consists of all pawn and consumer loan operations in Latin America, which includes operations in Mexico, Guatemala and El Salvador. In addition, some of the Company’s pawn stores offer small unsecured consumer loans or credit services products. The Company also operates consumer finance stores in Texas and Mexico.

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