CHINA MERCHANTS/ADR (OTCMKTS:CIHKY) and Elevate Credit (NYSE:ELVT) are both finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, valuation, risk, dividends, institutional ownership, profitability and analyst recommendations.

Dividends

CHINA MERCHANTS/ADR pays an annual dividend of $0.53 per share and has a dividend yield of 2.6%. Elevate Credit does not pay a dividend.

Analyst Ratings

This is a breakdown of current recommendations and price targets for CHINA MERCHANTS/ADR and Elevate Credit, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CHINA MERCHANTS/ADR 0 0 0 0 N/A
Elevate Credit 0 4 3 0 2.43

Elevate Credit has a consensus target price of $9.80, suggesting a potential upside of 115.86%. Given Elevate Credit’s higher probable upside, analysts clearly believe Elevate Credit is more favorable than CHINA MERCHANTS/ADR.

Profitability

This table compares CHINA MERCHANTS/ADR and Elevate Credit’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CHINA MERCHANTS/ADR 22.85% 16.71% 1.21%
Elevate Credit -0.49% 12.69% 1.93%

Insider & Institutional Ownership

0.0% of CHINA MERCHANTS/ADR shares are owned by institutional investors. Comparatively, 43.0% of Elevate Credit shares are owned by institutional investors. 32.0% of Elevate Credit shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Earnings & Valuation

This table compares CHINA MERCHANTS/ADR and Elevate Credit’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
CHINA MERCHANTS/ADR $46.95 billion 0.39 $10.38 billion N/A N/A
Elevate Credit $673.13 million 0.29 -$6.91 million $0.16 28.38

CHINA MERCHANTS/ADR has higher revenue and earnings than Elevate Credit.

Risk and Volatility

CHINA MERCHANTS/ADR has a beta of 1.46, meaning that its stock price is 46% more volatile than the S&P 500. Comparatively, Elevate Credit has a beta of 3.23, meaning that its stock price is 223% more volatile than the S&P 500.

Summary

Elevate Credit beats CHINA MERCHANTS/ADR on 7 of the 13 factors compared between the two stocks.

About CHINA MERCHANTS/ADR

China Merchants Bank Co., Ltd. provides various wholesale and retail banking products and services in the People's Republic of China and internationally. It operates through Wholesale Finance Business, Retail Finance Business, and Other Business segments. The company offers time, demand, call, notice, and RMB deposits; and deposit, current, and capital accounts. It also provides personal commercial real estate, consumption, housing, and car loans, as well as loans to finance for studying abroad; micro-business, combo, guarantee, and housing mortgage loans; mortgage loans for equipment; bank acceptance, discount, liquid capital, and fixed asset loans; and financial leasing, third-party payment, and guarantee services, as well as loans for vessels. In addition, the company offers investment and wealth management, and insurance products; individual forex option and express, and gold trading services; open ended funds; private banking and cash management services; and financial consultation, debt financing underwriting, merger and acquisition financing, and equity financing and enterprise listing services. Further, it provides settlement and trade chain financing services; international business, wealth investment, risk and financial management, cross border RMB financing, international factoring and settlement, oversea financing, and trade finance services; and forfeiting and risk participation, cross border RMB clearing, interbank business, and escrow services. Additionally, the company offers instruments; custody and pension services; credit cards; and Internet and mobile banking services. As of December 31, 2017, it had 137 branches; 1,681 sub-branches; 1 branch-level operation center; 1 representative office; 3,340 self-service centers; 11,382 self-service machines, including 1,610 automatic teller machines, and 9,772 deposit-taking and cash withdrawal machines; and 12,936 visual counters. The company was founded in 1987 and is headquartered in Shenzhen, China.

About Elevate Credit

Elevate Credit, Inc. provides online credit solutions to non-prime consumers in the United States and the United Kingdom. The company offers unsecured online installment loans and lines of credit. Its products include Rise installment loan and line of credit products; Elastic, a line of credit product; and Sunny installment loan products. Elevate Credit, Inc. was incorporated in 2014 and is headquartered in Fort Worth, Texas.

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