Comparing Encore Capital Group (NASDAQ:ECPG) & OneMain (NYSE:OMF)

OneMain (NYSE:OMF) and Encore Capital Group (NASDAQ:ECPG) are both mid-cap finance companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, institutional ownership, risk, analyst recommendations, profitability, earnings and valuation.

Analyst Ratings

This is a breakdown of current ratings for OneMain and Encore Capital Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
OneMain	1	3	9	0	2.62
Encore Capital Group	0	1	5	0	2.83

OneMain presently has a consensus price target of $66.82, suggesting a potential upside of 17.60%. Encore Capital Group has a consensus price target of $112.00, suggesting a potential downside of 11.23%. Given OneMain’s higher possible upside, equities analysts plainly believe OneMain is more favorable than Encore Capital Group.

Risk & Volatility

OneMain has a beta of 1.3, meaning that its stock price is 30% more volatile than the S&P 500. Comparatively, Encore Capital Group has a beta of 1.29, meaning that its stock price is 29% more volatile than the S&P 500.

Profitability

This table compares OneMain and Encore Capital Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
OneMain	13.43%	21.90%	2.68%
Encore Capital Group	17.67%	34.07%	6.44%

Institutional & Insider Ownership

85.8% of OneMain shares are held by institutional investors. 0.3% of OneMain shares are held by insiders. Comparatively, 3.0% of Encore Capital Group 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.

Valuation & Earnings

This table compares OneMain and Encore Capital Group”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
OneMain	$5.46 billion	1.19	$783.00 million	$6.57	8.65
Encore Capital Group	$1.77 billion	1.51	$256.83 million	$13.21	9.55

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

About OneMain

OneMain Holdings, Inc., a financial service holding company, engages in the consumer finance and insurance businesses in the United States. It originates, underwrites, and services personal loans secured by automobiles, other titled collateral, or unsecured. The company also offers credit cards; optional credit insurance products, including life, disability, and involuntary unemployment insurance; optional non-credit insurance; guaranteed asset protection coverage as a waiver product or insurance; and membership plans. It sells its products through its website. The company was formerly known as Springleaf Holdings, Inc. and changed its name to OneMain Holdings, Inc. in November 2015. OneMain Holdings, Inc. was founded in 1912 and is based in Evansville, Indiana.

About Encore Capital Group

Encore Capital Group, Inc., a specialty finance company, provides debt recovery solutions and other related services for consumers across financial assets worldwide. The company purchases portfolios of defaulted consumer receivables at deep discounts to face value, as well as manages them by working with individuals as they repay their obligations and works toward financial recovery. It is also involved in the provision of early stage collection, business process outsourcing, and contingent collection services. In addition, the company engages in debt servicing and other portfolio management services to credit originator for non-performing loans. Further, it offers credit management services. Encore Capital Group, Inc. was incorporated in 1999 and is headquartered in San Diego, California.