HA Sustainable Infrastructure Capital (NYSE:HASI) and XP (NASDAQ:XP) Head to Head Review

XP (NASDAQ:XP) and HA Sustainable Infrastructure Capital (NYSE:HASI) are both mid-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, risk, institutional ownership, dividends, profitability, valuation and analyst recommendations.

Risk and Volatility

XP has a beta of 1.1, indicating that its stock price is 10% more volatile than the S&P 500. Comparatively, HA Sustainable Infrastructure Capital has a beta of 1.43, indicating that its stock price is 43% more volatile than the S&P 500.

Profitability

This table compares XP and HA Sustainable Infrastructure Capital’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
XP	27.40%	22.51%	1.34%
HA Sustainable Infrastructure Capital	13.08%	12.80%	4.16%

Dividends

XP pays an annual dividend of $0.40 per share and has a dividend yield of 2.4%. HA Sustainable Infrastructure Capital pays an annual dividend of $1.70 per share and has a dividend yield of 4.5%. XP pays out 22.1% of its earnings in the form of a dividend. HA Sustainable Infrastructure Capital pays out 485.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. HA Sustainable Infrastructure Capital has raised its dividend for 2 consecutive years. HA Sustainable Infrastructure Capital is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation and Earnings

This table compares XP and HA Sustainable Infrastructure Capital”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
XP	$3.30 billion	2.77	$925.91 million	$1.81	9.40
HA Sustainable Infrastructure Capital	$400.50 million	12.14	$184.55 million	$0.35	108.14

XP has higher revenue and earnings than HA Sustainable Infrastructure Capital. XP is trading at a lower price-to-earnings ratio than HA Sustainable Infrastructure Capital, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for XP and HA Sustainable Infrastructure Capital, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
XP	0	2	3	0	2.60
HA Sustainable Infrastructure Capital	0	2	10	0	2.83

XP currently has a consensus price target of $23.33, indicating a potential upside of 37.21%. HA Sustainable Infrastructure Capital has a consensus price target of $46.90, indicating a potential upside of 23.92%. Given XP’s higher probable upside, equities research analysts clearly believe XP is more favorable than HA Sustainable Infrastructure Capital.

Institutional and Insider Ownership

59.2% of XP shares are held by institutional investors. Comparatively, 96.1% of HA Sustainable Infrastructure Capital shares are held by institutional investors. 2.2% of HA Sustainable Infrastructure Capital shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Summary

HA Sustainable Infrastructure Capital beats XP on 10 of the 17 factors compared between the two stocks.

About XP

XP Inc. provides financial products and services in Brazil. It offers securities brokerage, private pension plans, commercial, and investment banking products, such as loan operations and transactions in the foreign exchange markets and deposits; product structuring and capital markets services for corporate clients and issuers of fixed income products; advisory services for mass-affluent and institutional clients; and wealth management services for high-net-worth customers and institutional clients. The company also offers XP Educação, an online financial education portal that offers seminars, classes, and learning tools to help teach individuals on topics, such as basics of investing, techniques, and investment strategies, as well as insurance brokerage services. In addition, it operates XP Platform, an open product platform that provides clients to access investment products in the market, including equity and fixed income securities, mutual and hedge funds, structured products, life insurance, pension plans, real-estate investment funds, and others. The company was founded in 2001 and is based in São Paulo, Brazil.

About HA Sustainable Infrastructure Capital

HA Sustainable Infrastructure Capital, Inc., through its subsidiaries, engages in the investment of energy efficiency, renewable energy, and sustainable infrastructure markets in the United States. The company’s portfolio includes equity investments, commercial and government receivables, real estate, and debt securities. It invests in climate solutions, including Behind-the-Meter, which distributes energy projects that reduce energy usage or cost through heating, ventilation, and air conditioning systems, as well as lighting, energy controls, roofs, windows, building shells, and/or combined heat and power systems; Grid-Connected, a renewable energy projects that deploy cleaner energy sources, such as solar, solar-plus-storage, and wind to generate power production; and Fuels, Transport, and Nature, a range of real assets spanning high-emitting economic sectors other than the power grid such as transportation and fuels comprising renewable natural gas plants, transportation fleet enhancements, ecological restoration, and other projects. HA Sustainable Infrastructure Capital, Inc. was founded in 1981 and is headquartered in Annapolis, Maryland.