Head-To-Head Review: Yirendai (NYSE:YRD) and FirstCash (NASDAQ:FCFS)

FirstCash (NASDAQ:FCFS) and Yirendai (NYSE:YRD) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, risk, earnings, analyst recommendations and profitability.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for FirstCash and Yirendai, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
FirstCash	0	1	5	0	2.83
Yirendai	1	0	0	0	1.00

FirstCash currently has a consensus price target of $247.50, suggesting a potential upside of 43.27%. Given FirstCash’s stronger consensus rating and higher probable upside, research analysts clearly believe FirstCash is more favorable than Yirendai.

Profitability

This table compares FirstCash and Yirendai’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
FirstCash	9.48%	20.17%	8.52%
Yirendai	-35.36%	-17.30%	-11.97%

Valuation & Earnings

This table compares FirstCash and Yirendai”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
FirstCash	$3.66 billion	2.05	$330.38 million	$9.23	18.72
Yirendai	$817.84 million	0.07	$7.80 million	($2.50)	-0.27

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

Volatility & Risk

FirstCash has a beta of 0.55, suggesting that its stock price is 45% less volatile than the S&P 500. Comparatively, Yirendai has a beta of 1.13, suggesting that its stock price is 13% more volatile than the S&P 500.

Institutional and Insider Ownership

80.3% of FirstCash shares are owned by institutional investors. Comparatively, 2.0% of Yirendai shares are owned by institutional investors. 2.9% of FirstCash shares are owned by insiders. Comparatively, 42.2% of Yirendai shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Summary

FirstCash beats Yirendai on 12 of the 14 factors compared between the two stocks.

About FirstCash

FirstCash Holdings, Inc, together with its subsidiaries, operates retail pawn stores in the United States, Mexico, and rest of Latin America. The company operates in three segments: U.S. Pawn, Latin America Pawn, and Retail POS Payment Solutions segments. Its pawn stores lend money on the collateral of pledged personal property, including jewelry, electronics, tools, appliances, sporting goods, and musical instruments; and retails merchandise acquired through collateral forfeitures on forfeited pawn loans and over-the-counter purchases of merchandise directly from customers. The company also provides retail POS payment solutions, which focuses on LTO products and facilitating other retail financing payment options across the network of traditional and e-commerce merchant partners. It serves cash and credit-constrained consumers. The company was formerly known as FirstCash, Inc and changed its name to FirstCash Holdings, Inc. in December 2021. FirstCash Holdings, Inc was incorporated in 1988 and is headquartered in Fort Worth, Texas.

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.