Reviewing loanDepot (NYSE:LDI) and UWM (NYSE:UWMC)

UWM (NYSE:UWMC) and loanDepot (NYSE:LDI) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, valuation, institutional ownership, earnings, dividends, analyst recommendations and profitability.

Insider & Institutional Ownership

53.6% of UWM shares are owned by institutional investors. Comparatively, 39.4% of loanDepot shares are owned by institutional investors. 87.5% of UWM shares are owned by insiders. Comparatively, 78.1% of loanDepot shares are owned 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.

Dividends

UWM pays an annual dividend of $0.40 per share and has a dividend yield of 7.9%. loanDepot pays an annual dividend of $4.80 per share and has a dividend yield of 199.6%. loanDepot pays out -1,333.3% of its earnings in the form of a dividend.

Risk and Volatility

UWM has a beta of 1.92, indicating that its share price is 92% more volatile than the S&P 500. Comparatively, loanDepot has a beta of 3.45, indicating that its share price is 245% more volatile than the S&P 500.

Earnings & Valuation

This table compares UWM and loanDepot”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
UWM	$1.37 billion	5.92	$14.40 million	N/A	N/A
loanDepot	$888.06 million	0.90	-$98.33 million	($0.36)	-6.68

UWM has higher revenue and earnings than loanDepot.

Profitability

This table compares UWM and loanDepot’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
UWM	0.61%	-6.81%	-0.79%
loanDepot	-6.46%	-22.40%	-1.64%

Analyst Ratings

This is a summary of recent recommendations for UWM and loanDepot, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
UWM	1	6	2	0	2.11
loanDepot	2	2	0	0	1.50

UWM currently has a consensus price target of $6.46, indicating a potential upside of 27.88%. loanDepot has a consensus price target of $2.58, indicating a potential upside of 7.42%. Given UWM’s stronger consensus rating and higher probable upside, analysts clearly believe UWM is more favorable than loanDepot.

Summary

UWM beats loanDepot on 11 of the 14 factors compared between the two stocks.

About UWM

UWM Holdings Corporation engages in the residential mortgage lending business in the United States. The company offers mortgage loans through wholesale channel. It originates primarily conforming and government loans. UWM Holdings Corporation was founded in 1986 and is headquartered in Pontiac, Michigan.

About loanDepot

loanDepot, Inc. engages in originating, financing, selling, and servicing residential mortgage loans in the United States. The company offers conventional agency-conforming and prime jumbo, federal assistance residential mortgage, and home equity loans. It also provides settlement services, which include captive title and escrow business; real estate services that cover captive real estate referral business; and insurance services, including services to homeowners, as well as other consumer insurance policies. The company was founded in 2010 and is headquartered in Irvine, California.