Finance of America Companies (NYSE:FOA – Get Free Report) and LendingTree (NASDAQ:TREE – Get Free Report) are both small-cap finance companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, valuation, risk, institutional ownership, earnings, analyst recommendations and dividends.
Volatility & Risk
Finance of America Companies has a beta of 1.44, meaning that its share price is 44% more volatile than the S&P 500. Comparatively, LendingTree has a beta of 1.61, meaning that its share price is 61% more volatile than the S&P 500.
Analyst Recommendations
This is a breakdown of recent ratings and recommmendations for Finance of America Companies and LendingTree, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Finance of America Companies | 0 | 1 | 1 | 0 | 2.50 |
| LendingTree | 0 | 1 | 7 | 1 | 3.00 |
Profitability
This table compares Finance of America Companies and LendingTree’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Finance of America Companies | N/A | -3.12% | -0.04% |
| LendingTree | -5.67% | 14.76% | 2.13% |
Valuation & Earnings
This table compares Finance of America Companies and LendingTree”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Finance of America Companies | $338.17 million | 0.76 | $15.49 million | $3.68 | 6.32 |
| LendingTree | $900.22 million | 0.58 | -$41.70 million | ($4.13) | -9.31 |
Finance of America Companies has higher earnings, but lower revenue than LendingTree. LendingTree is trading at a lower price-to-earnings ratio than Finance of America Companies, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
97.2% of Finance of America Companies shares are owned by institutional investors. Comparatively, 68.3% of LendingTree shares are owned by institutional investors. 25.0% of Finance of America Companies shares are owned by insiders. Comparatively, 23.4% of LendingTree shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Summary
LendingTree beats Finance of America Companies on 8 of the 15 factors compared between the two stocks.
About Finance of America Companies
Finance of America Companies Inc. a financial service holding company, through its subsidiaries, engages in the operation of a retirement solutions platform in the United States. It operates through two segments: Retirement Solutions and Portfolio Management. The Retirement Solutions segment engages in the loan origination activities comprising home equity conversion, proprietary reverse, and hybrid mortgage loans for senior homeowners. The Portfolio Management segment provides product development, loan securitization, loan sales, risk management, servicing oversight, and asset management services for borrowers and investors. The company was founded in 2013 and is headquartered in Plano, Texas.
About LendingTree
LendingTree, Inc., through its subsidiary, operates online consumer platform in the United States. It operates through three segments: Home, Consumer, and Insurance. The Home segment offers purchase mortgage, refinance mortgage, and home equity loans and lines of credit; and real estate brokerage services. The Consumer segment provides credit cards; personal, small business, student, and auto loans; deposit accounts; and other credit products, such as debt settlement services. The Insurance segment includes information, tools, and access to insurance quote products, including home, automobile, and health and Medicare through which consumers are matched with insurance lead aggregators to obtain insurance offers and policies. In addition, the company offers QuoteWizard, a marketplace for insurance comparison; ValuePenguin, a personal finance website that offers consumers objective analysis on various financial topics from insurance to credit cards; and Stash, a consumer investing and banking platform that offers a suite of personal investment accounts, traditional and Roth IRAs, custodial investment accounts, and banking services, including checking accounts and debit cards with a Stock-Back rewards program. The company was formerly known as Tree.com, Inc. and changed its name to LendingTree, Inc. in January 2015. LendingTree, Inc. was incorporated in 1996 and is based in Charlotte, North Carolina.
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