Yirendai (NYSE:YRD – Get Free Report) and FirstCash (NASDAQ:FCFS – Get Free Report) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their valuation, earnings, analyst recommendations, institutional ownership, profitability, dividends and risk.
Profitability
This table compares Yirendai and FirstCash’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Yirendai | -35.36% | -17.30% | -11.97% |
| FirstCash | 9.48% | 20.17% | 8.52% |
Risk and Volatility
Yirendai has a beta of 1.13, suggesting that its share price is 13% more volatile than the S&P 500. Comparatively, FirstCash has a beta of 0.55, suggesting that its share price is 45% less volatile than the S&P 500.
Analyst Ratings
This is a breakdown of recent recommendations for Yirendai and FirstCash, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Yirendai | 1 | 0 | 0 | 0 | 1.00 |
| FirstCash | 0 | 1 | 5 | 0 | 2.83 |
FirstCash has a consensus price target of $247.50, suggesting a potential upside of 41.21%. Given FirstCash’s stronger consensus rating and higher probable upside, analysts clearly believe FirstCash is more favorable than Yirendai.
Insider & Institutional Ownership
2.0% of Yirendai shares are held by institutional investors. Comparatively, 80.3% of FirstCash shares are held by institutional investors. 42.2% of Yirendai shares are held by insiders. Comparatively, 2.9% of FirstCash shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
Earnings & Valuation
This table compares Yirendai and FirstCash”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Yirendai | $4.30 billion | 0.01 | $7.80 million | ($2.50) | -0.23 |
| FirstCash | $3.66 billion | 2.08 | $330.38 million | $9.23 | 18.99 |
FirstCash has lower revenue, but higher earnings than Yirendai. Yirendai is trading at a lower price-to-earnings ratio than FirstCash, indicating that it is currently the more affordable of the two stocks.
Dividends
Yirendai pays an annual dividend of $0.20 per share and has a dividend yield of 34.6%. FirstCash pays an annual dividend of $1.68 per share and has a dividend yield of 1.0%. Yirendai pays out -8.0% of its earnings in the form of a dividend. FirstCash pays out 18.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. FirstCash has increased its dividend for 8 consecutive years. Yirendai is clearly the better dividend stock, given its higher yield and lower payout ratio.
Summary
FirstCash beats Yirendai on 12 of the 17 factors compared between the two stocks.
About Yirendai
Yiren Digital Ltd. provides financial services through an AI-powered platform in China. Its platform provides a suite of financial and lifestyle services. The company offers financial services, which provides a portfolio of loan products to borrowers; insurance brokerage services; and consumption and lifestyle services, including non-financial products and services to meet various consumer needs. It supports clients at various growth stages, addressing financing needs arising from consumption and production activities, and augmenting the well-being and security of individuals, families, and businesses. The company was formerly known as Yirendai Ltd. and changed its name to Yiren Digital Ltd. in September 2019. Yiren Digital Ltd. was founded in 2012 and is based in Beijing, the People's Republic of China. Yiren Digital Ltd. operates as a subsidiary of CreditEase Holdings (Cayman) Limited.
About FirstCash
FirstCash Holdings, Inc, together with its subsidiaries, operates retail pawn stores in the United States, Mexico, and rest of Latin America. The company operates in three segments: U.S. Pawn, Latin America Pawn, and Retail POS Payment Solutions segments. Its pawn stores lend money on the collateral of pledged personal property, including jewelry, electronics, tools, appliances, sporting goods, and musical instruments; and retails merchandise acquired through collateral forfeitures on forfeited pawn loans and over-the-counter purchases of merchandise directly from customers. The company also provides retail POS payment solutions, which focuses on LTO products and facilitating other retail financing payment options across the network of traditional and e-commerce merchant partners. It serves cash and credit-constrained consumers. The company was formerly known as FirstCash, Inc and changed its name to FirstCash Holdings, Inc. in December 2021. FirstCash Holdings, Inc was incorporated in 1988 and is headquartered in Fort Worth, Texas.
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