Contrasting Vroom (NASDAQ:VRM) and OppFi (NYSE:OPFI)

OppFi (NYSE:OPFI) and Vroom (NASDAQ:VRM) are both small-cap finance companies, but which is the better business? We will contrast the two businesses based on the strength of their earnings, profitability, analyst recommendations, valuation, risk, dividends and institutional ownership.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for OppFi and Vroom, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
OppFi	1	3	2	0	2.17
Vroom	1	0	0	0	1.00

OppFi currently has a consensus target price of $10.50, indicating a potential upside of 75.15%. Given OppFi’s stronger consensus rating and higher probable upside, analysts clearly believe OppFi is more favorable than Vroom.

Profitability

This table compares OppFi and Vroom’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
OppFi	16.64%	30.89%	13.99%
Vroom	-32.38%	-47.65%	-5.59%

Institutional & Insider Ownership

7.1% of OppFi shares are owned by institutional investors. Comparatively, 25.8% of Vroom shares are owned by institutional investors. 70.2% of OppFi shares are owned by company insiders. Comparatively, 2.9% of Vroom shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares OppFi and Vroom”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
OppFi	$597.05 million	0.86	$26.33 million	$1.89	3.17
Vroom	$178.83 million	0.26	-$7.96 million	($11.12)	-0.81

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

Risk & Volatility

OppFi has a beta of 1.78, meaning that its share price is 78% more volatile than the S&P 500. Comparatively, Vroom has a beta of 1.27, meaning that its share price is 27% more volatile than the S&P 500.

Summary

OppFi beats Vroom on 13 of the 14 factors compared between the two stocks.

About OppFi

OppFi Inc. operates a cialty finance platform that allows banks to offer credit access. Its platform facilitates the OppLoans, an installment loan product; SalaryTap, a payroll deduction secured installment loan product; and OppFi Card, a credit card product. OppFi Inc. was founded in 2012 and is headquartered in Chicago, Illinois.

About Vroom

Vroom, Inc. operates as an automotive finance company. The company offers vehicle financing to its customers through third party dealers under the UACC brand. It also provides artificial intelligence powered analytics and digital services to dealers, automotive financial services companies, and others in the automotive industry for automotive retail. The company was formerly known as Auto America, Inc. and changed its name to Vroom, Inc. in July 2015. Vroom, Inc. was incorporated in 2012 and is based in Houston, Texas.