Critical Review: Essent Group (NYSE:ESNT) & Marqeta (NASDAQ:MQ)

Essent Group (NYSE:ESNT) and Marqeta (NASDAQ:MQ) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their dividends, risk, earnings, institutional ownership, profitability, valuation and analyst recommendations.

Earnings & Valuation

This table compares Essent Group and Marqeta”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Essent Group	$1.26 billion	4.44	$689.97 million	$7.17	8.69
Marqeta	$624.88 million	2.97	-$13.93 million	$0.11	162.07

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

Volatility & Risk

Essent Group has a beta of 0.76, meaning that its share price is 24% less volatile than the S&P 500. Comparatively, Marqeta has a beta of 1.21, meaning that its share price is 21% more volatile than the S&P 500.

Institutional & Insider Ownership

93.0% of Essent Group shares are owned by institutional investors. Comparatively, 78.6% of Marqeta shares are owned by institutional investors. 3.6% of Essent Group shares are owned by insiders. Comparatively, 13.7% of Marqeta shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Essent Group and Marqeta, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Essent Group	0	6	3	0	2.33
Marqeta	1	7	1	1	2.20

Essent Group currently has a consensus price target of $71.14, indicating a potential upside of 14.23%. Marqeta has a consensus price target of $19.71, indicating a potential upside of 10.58%. Given Essent Group’s stronger consensus rating and higher probable upside, research analysts clearly believe Essent Group is more favorable than Marqeta.

Profitability

This table compares Essent Group and Marqeta’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Essent Group	51.45%	11.91%	9.09%
Marqeta	1.53%	1.36%	0.71%

Summary

Essent Group beats Marqeta on 11 of the 15 factors compared between the two stocks.

About Essent Group

Essent Group Ltd., through its subsidiaries, provides private mortgage insurance and reinsurance for mortgages secured by residential properties located in the United States. Its mortgage insurance products include primary, pool, and master policy. The company also provides information technology maintenance and development services; customer support-related services; underwriting consulting; and contract underwriting services, as well as risk management products and title insurance and settlement services. It serves the originators of residential mortgage loans, such as regulated depository institutions, mortgage banks, credit unions, and other lenders. Essent Group Ltd. was incorporated in 2008 and is based in Hamilton, Bermuda.

About Marqeta

Marqeta, Inc. operates a cloud-based open application programming interface platform that delivers card issuing and transaction processing services. It offers its solutions in various verticals, including financial services, on-demand services, expense management, and e-commerce enablement, as well as buy now, pay later. Marqeta, Inc. was incorporated in 2010 and is headquartered in Oakland, California.