Evertec (NYSE:EVTC) and loanDepot (NYSE:LDI) Head-To-Head Contrast

loanDepot (NYSE:LDI) and Evertec (NYSE:EVTC) are both small-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, earnings, risk, profitability, analyst recommendations, institutional ownership and dividends.

Profitability

This table compares loanDepot and Evertec’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
loanDepot	-5.52%	-28.25%	-1.56%
Evertec	9.80%	32.07%	9.12%

Risk and Volatility

loanDepot has a beta of 3.45, meaning that its stock price is 245% more volatile than the S&P 500. Comparatively, Evertec has a beta of 0.72, meaning that its stock price is 28% less volatile than the S&P 500.

Earnings and Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
loanDepot	$1.19 billion	0.15	-$62.65 million	($0.30)	-1.79
Evertec	$931.82 million	2.00	$141.59 million	$1.54	20.29

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

Analyst Ratings

This is a breakdown of recent ratings and target prices for loanDepot and Evertec, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
loanDepot	2	2	0	0	1.50
Evertec	0	4	2	0	2.33

loanDepot presently has a consensus price target of $1.38, suggesting a potential upside of 156.53%. Evertec has a consensus price target of $35.00, suggesting a potential upside of 11.99%. Given loanDepot’s higher probable upside, equities analysts clearly believe loanDepot is more favorable than Evertec.

Institutional and Insider Ownership

39.4% of loanDepot shares are owned by institutional investors. Comparatively, 96.8% of Evertec shares are owned by institutional investors. 65.9% of loanDepot shares are owned by company insiders. Comparatively, 1.1% of Evertec shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Summary

Evertec beats loanDepot on 10 of the 14 factors compared between the two stocks.

About loanDepot

loanDepot, Inc. engages in originating, financing, selling, and servicing residential mortgage loans in the United States. The company offers conventional agency-conforming and prime jumbo, federal assistance residential mortgage, and home equity loans. It also provides settlement services, which include captive title and escrow business; real estate services that cover captive real estate referral business; and insurance services, including services to homeowners, as well as other consumer insurance policies. The company was founded in 2010 and is headquartered in Irvine, California.

About Evertec

EVERTEC, Inc. engages in transaction processing business and financial technology in Latin America and the Caribbean. The company operates through four segments: Payment Services – Puerto Rico & Caribbean; Latin America Payments and Solutions; Merchant Acquiring; and Business Solutions. It provides merchant acquiring services, which enable point of sales and e-commerce merchants to accept and process electronic methods of payment, such as debit, credit, prepaid, and electronic benefit transfer (EBT) cards. In addition, the company offers payment processing services that enable financial institutions and other issuers to manage, support, and facilitate the processing for credit, debit, prepaid, automated teller machines, and EBT card programs; credit and debit card processing, authorization and settlement, and fraud monitoring and control services to debit or credit issuers services. Further, it provides business process management solutions comprising core bank processing, network hosting and management, IT professional, business process outsourcing, item and cash processing, and fulfillment solutions to merchant, fintech, financial institutions, and corporate and government customers. Additionally, the company owns and operates the ATH network, a personal identification number debit networks. It manages a system of electronic payment networks that process approximately six billion transactions. The company sells and distributes its services primarily through direct sales force. It serves financial institutions, merchants, corporations, and government agencies. EVERTEC, Inc. was founded in 1988 and is headquartered in San Juan, Puerto Rico.