Contrasting Nelnet (NYSE:NNI) and Oportun Financial (NASDAQ:OPRT)

Oportun Financial (NASDAQ:OPRT) and Nelnet (NYSE:NNI) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their profitability, valuation, dividends, earnings, risk, analyst recommendations and institutional ownership.

Insider & Institutional Ownership

82.7% of Oportun Financial shares are held by institutional investors. Comparatively, 33.5% of Nelnet shares are held by institutional investors. 1.6% of Oportun Financial shares are held by insiders. Comparatively, 40.3% of Nelnet shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Oportun Financial and Nelnet”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Oportun Financial	$417.50 million	1.25	$25.25 million	$0.74	15.36
Nelnet	$1.44 billion	3.28	$428.47 million	$7.55	17.44

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

Volatility and Risk

Oportun Financial has a beta of 1.29, indicating that its stock price is 29% more volatile than the S&P 500. Comparatively, Nelnet has a beta of 0.78, indicating that its stock price is 22% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Oportun Financial and Nelnet, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Oportun Financial	0	3	2	0	2.40
Nelnet	1	2	0	0	1.67

Oportun Financial currently has a consensus target price of $9.25, suggesting a potential downside of 18.65%. Nelnet has a consensus target price of $125.00, suggesting a potential downside of 5.05%. Given Nelnet’s higher probable upside, analysts clearly believe Nelnet is more favorable than Oportun Financial.

Profitability

This table compares Oportun Financial and Nelnet’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Oportun Financial	3.88%	14.67%	1.87%
Nelnet	12.93%	7.15%	1.82%

Summary

Nelnet beats Oportun Financial on 8 of the 14 factors compared between the two stocks.

About Oportun Financial

Oportun Financial Corporation provides financial services. The company offers personal loans and credit cards. It serves customers through online and over the phone, as well as through retail and Lending as a Service partner locations. The company was founded in 2005 and is headquartered in San Carlos, California.

About Nelnet

Nelnet, Inc. engages in loan servicing, communications, education technology, services, and payment processing businesses worldwide. The Loan Servicing and Systems segment provides loan conversion, application processing, borrower updates, customer service, payment processing, due diligence procedures, funds management reconciliation, and claim processing services. This segment also offers student loan servicing software; business process outsourcing services specialized in contact center management, such as inbound calls, outreach campaigns and sales, and interacting with customers through multi-channels, and processing and technology services. The Education Technology Services and Payments segment provides financial management services; school information system software; website design and cost-effective admissions software; FACTS Giving, a donation platform; and customized professional development and coaching services, educational instruction services, and technology products that aid in teacher and student evaluations. This segment also offers tuition payment plans, and service and technology for student billings, payments, and refunds; solutions for in-person, online, and mobile payment experiences on campus; payment processing services, such as credit card and electronic transfer; faith community, giving, and learning management services and technologies; and an integrated commerce payment platform, financial management, and tuition payment plan services, as well as a school management platform that provides administrative, information and financial management, and communication functions for K-12 schools. The Asset Generation and Management segment acquires, manages, and owns loan assets. The Nelnet Bank segment operates as an internet industrial bank. It also offers investment advisory, insurance, and reinsurance services, as well as engages in real estate investment business. The company was incorporated in 1977 and is headquartered in Lincoln, Nebraska.