Critical Contrast: Lendingclub (HAPN) and Its Competitors

Lendingclub (NASDAQ:HAPN) is one of 121 publicly-traded companies in the “Consumer Finance” industry, but how does it contrast to its peers? We will compare Lendingclub to related companies based on the strength of its valuation, earnings, profitability, dividends, institutional ownership, risk and analyst recommendations.

Risk & Volatility

Lendingclub has a beta of 1.86, meaning that its share price is 86% more volatile than the S&P 500. Comparatively, Lendingclub’s peers have a beta of 1.24, meaning that their average share price is 24% more volatile than the S&P 500.

Earnings & Valuation

This table compares Lendingclub and its peers gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Lendingclub	$1.05 billion	$135.68 million	10.07
Lendingclub Competitors	$4.20 billion	$381.70 million	6.69

Lendingclub’s peers have higher revenue and earnings than Lendingclub. Lendingclub is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Profitability

This table compares Lendingclub and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Lendingclub	18.67%	12.92%	1.66%
Lendingclub Competitors	9.64%	-33.03%	2.25%

Insider and Institutional Ownership

74.1% of Lendingclub shares are held by institutional investors. Comparatively, 46.3% of shares of all “Consumer Finance” companies are held by institutional investors. 3.3% of Lendingclub shares are held by insiders. Comparatively, 21.8% of shares of all “Consumer Finance” companies are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of recent recommendations for Lendingclub and its peers, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lendingclub	0	1	2	0	2.67
Lendingclub Competitors	906	3390	5288	272	2.50

Lendingclub presently has a consensus price target of $25.00, suggesting a potential upside of 49.61%. As a group, “Consumer Finance” companies have a potential upside of 12.58%. Given Lendingclub’s stronger consensus rating and higher possible upside, analysts plainly believe Lendingclub is more favorable than its peers.

Summary

Lendingclub beats its peers on 8 of the 13 factors compared.

About Lendingclub

LendingClub Corporation, operates as a bank holding company for LendingClub Bank, National Association that provides range of financial products and services through a technology-driven platform in the United States. The company provides commercial and industrial, commercial real estate, small business, and equipment loans, as well as leases equipment; and unsecured personal and auto, patient finance, and education finance loans. It also operates an online lending marketplace platform that connects borrowers and investors. LendingClub Corporation was incorporated in 2006 and is headquartered in San Francisco, California.