iQIYI (NASDAQ:IQ – Get Free Report) and Yirendai (NYSE:YRD – Get Free Report) are both small-cap computer and technology companies, but which is the better investment? We will compare the two companies based on the strength of their valuation, institutional ownership, profitability, earnings, dividends, risk and analyst recommendations.
Analyst Recommendations
This is a breakdown of recent recommendations and price targets for iQIYI and Yirendai, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| iQIYI | 2 | 1 | 2 | 0 | 2.00 |
| Yirendai | 1 | 0 | 0 | 0 | 1.00 |
iQIYI currently has a consensus target price of $2.55, indicating a potential upside of 154.92%. Given iQIYI’s stronger consensus rating and higher probable upside, analysts clearly believe iQIYI is more favorable than Yirendai.
Valuation & Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| iQIYI | $3.80 billion | 0.25 | -$29.50 million | ($0.10) | -9.99 |
| Yirendai | $817.84 million | 0.12 | $7.80 million | $0.03 | 36.50 |
Yirendai has lower revenue, but higher earnings than iQIYI. iQIYI is trading at a lower price-to-earnings ratio than Yirendai, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares iQIYI and Yirendai’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| iQIYI | -2.61% | -4.72% | -1.36% |
| Yirendai | -14.35% | -7.42% | -5.06% |
Institutional & Insider Ownership
52.7% of iQIYI shares are held by institutional investors. Comparatively, 2.0% of Yirendai shares are held by institutional investors. 57.8% of iQIYI shares are held by insiders. Comparatively, 42.2% of Yirendai shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
Volatility & Risk
iQIYI has a beta of 0.19, indicating that its share price is 81% less volatile than the S&P 500. Comparatively, Yirendai has a beta of 1.12, indicating that its share price is 12% more volatile than the S&P 500.
Summary
iQIYI beats Yirendai on 10 of the 14 factors compared between the two stocks.
About iQIYI
iQIYI, Inc., together with its subsidiaries, provides online entertainment video services in the People's Republic of China. It offers various products and services, including online video, online games, online literature, animations, and other products. The company operates a platform that provides a collection of internet video content, such as professionally produced content licensed from professional content providers and self-produced content. It also offers membership, online advertising, content distribution, and live broadcasting services. In addition, the company operates iQIYI Show, a live broadcasting platform that enables users to follow their favorite hosts and shows in real time through live broadcasting; and iQIYI Lite that offers an easy and quick access to the personalized videos based on their user preferences. Further, it is involved in the talent agency and IP licensing activities, as well as engages in developing a video community app. The company was formerly known as Qiyi.com, Inc. and changed its name to iQIYI, Inc. in November 2017. iQIYI, Inc. was incorporated in 2009 and is headquartered in Beijing, China. iQIYI, Inc. is a subsidiary of Baidu, Inc.
About Yirendai
Yiren Digital Ltd. provides financial services through an AI-powered platform in China. Its platform provides a suite of financial and lifestyle services. The company offers financial services, which provides a portfolio of loan products to borrowers; insurance brokerage services; and consumption and lifestyle services, including non-financial products and services to meet various consumer needs. It supports clients at various growth stages, addressing financing needs arising from consumption and production activities, and augmenting the well-being and security of individuals, families, and businesses. The company was formerly known as Yirendai Ltd. and changed its name to Yiren Digital Ltd. in September 2019. Yiren Digital Ltd. was founded in 2012 and is based in Beijing, the People's Republic of China. Yiren Digital Ltd. operates as a subsidiary of CreditEase Holdings (Cayman) Limited.
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