Reviewing Qfin (NASDAQ:QFIN) and PROG (NYSE:PRG)

PROG (NYSE:PRG) and Qfin (NASDAQ:QFIN) are both small-cap finance companies, but which is the better business? We will contrast the two businesses based on the strength of their analyst recommendations, profitability, institutional ownership, risk, dividends, valuation and earnings.

Dividends

PROG pays an annual dividend of $0.56 per share and has a dividend yield of 1.4%. Qfin pays an annual dividend of $0.90 per share and has a dividend yield of 10.2%. PROG pays out 15.5% of its earnings in the form of a dividend. Qfin pays out 21.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. PROG has raised its dividend for 2 consecutive years.

Analyst Ratings

This is a summary of recent ratings and recommmendations for PROG and Qfin, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
PROG	0	3	6	1	2.80
Qfin	3	4	1	0	1.75

PROG currently has a consensus price target of $49.44, indicating a potential upside of 26.15%. Qfin has a consensus price target of $12.29, indicating a potential upside of 39.64%. Given Qfin’s higher probable upside, analysts clearly believe Qfin is more favorable than PROG.

Earnings and Valuation

This table compares PROG and Qfin”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
PROG	$2.41 billion	0.65	$146.79 million	$3.62	10.83
Qfin	$13.27 billion	0.08	$856.52 million	$4.16	2.12

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

Insider and Institutional Ownership

97.9% of PROG shares are owned by institutional investors. Comparatively, 74.8% of Qfin shares are owned by institutional investors. 3.7% of PROG shares are owned by company insiders. Comparatively, 17.1% of Qfin 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.

Volatility & Risk

PROG has a beta of 1.79, meaning that its share price is 79% more volatile than the S&P 500. Comparatively, Qfin has a beta of 0.63, meaning that its share price is 37% less volatile than the S&P 500.

Profitability

This table compares PROG and Qfin’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
PROG	5.57%	21.88%	9.15%
Qfin	22.23%	15.23%	6.60%

Summary

PROG beats Qfin on 11 of the 18 factors compared between the two stocks.

About PROG

PROG Holdings, Inc. (NYSE:PRG) is a financial technology holding company based in Salt Lake City, Utah with three business segments: Progressive Leasing, which offers lease-to-own transactions primarily to credit-challenged consumers through e-commerce and point-of-sale retail partners, via online, mobile, and in-store solutions; Vive Financial, which provides consumers who may not qualify for traditional prime lending with a variety of second-look, revolving credit products through private label and branded credit cards; and Four Technologies, which provides consumers of all credit backgrounds Buy Now, Pay Later (BNPL) options through four interest-free installments via its platform, Four.

About Qfin

Qifu Technology, Inc., through its subsidiaries, operates credit-tech platform under the 360 Jietiao brand in the People's Republic of China. It provides credit-driven services that matches borrowers with financial institutions to conduct customer acquisition, initial and credit screening, advanced risk assessment, credit assessment, fund matching, and other post-facilitation services; and platform services, including loan facilitation and post-facilitation services to financial institution partners under intelligence credit engine, referral services, and risk management software-as-a-service. The company also offers e-commerce loans, enterprise loans, and invoice loans to SME owners. It serves financial institutions, consumers, and small- and micro-enterprises. The company was formerly known as 360 DigiTech, Inc. and changed its name to Qifu Technology, Inc. in March 2023. The company was founded in 2016 and is headquartered in Shanghai, the People's Republic of China.