Reviewing PRA Group (NASDAQ:PRAA) & Oportun Financial (NASDAQ:OPRT)

Oportun Financial (NASDAQ:OPRT) and PRA Group (NASDAQ:PRAA) are both small-cap finance companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, profitability, dividends, valuation, analyst recommendations, risk and earnings.

Risk and Volatility

Oportun Financial has a beta of 1.29, meaning that its stock price is 29% more volatile than the S&P 500. Comparatively, PRA Group has a beta of 1.15, meaning that its stock price is 15% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Oportun Financial and PRA Group, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Oportun Financial	0	3	2	0	2.40
PRA Group	1	3	0	0	1.75

Oportun Financial presently has a consensus price target of $9.25, suggesting a potential downside of 20.60%. Given Oportun Financial’s stronger consensus rating and higher probable upside, equities analysts clearly believe Oportun Financial is more favorable than PRA Group.

Valuation and Earnings

This table compares Oportun Financial and PRA Group”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Oportun Financial	$956.70 million	0.56	$25.25 million	$0.74	15.74
PRA Group	$1.20 billion	0.37	-$305.14 million	$4.09	2.92

Oportun Financial has higher earnings, but lower revenue than PRA Group. PRA Group is trading at a lower price-to-earnings ratio than Oportun Financial, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Oportun Financial and PRA Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Oportun Financial	3.88%	14.67%	1.87%
PRA Group	12.06%	14.48%	3.03%

Institutional and Insider Ownership

82.7% of Oportun Financial shares are held by institutional investors. Comparatively, 97.2% of PRA Group shares are held by institutional investors. 1.6% of Oportun Financial shares are held by insiders. Comparatively, 2.2% of PRA Group shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Summary

Oportun Financial beats PRA Group on 8 of the 14 factors compared between the two stocks.

About Oportun Financial

Oportun Financial Corp. is a financial technology company that provides credit products and related financial services to consumers in the United States, with a particular focus on serving Hispanic and other traditionally underserved communities. The company uses data-driven underwriting and digital tools to offer customers access to credit, including borrowers who may have limited credit histories. Oportun’s primary products have included unsecured personal loans and credit cards. Through its digital platform and customer service channels, the company has also provided tools intended to help consumers manage borrowing, make payments and build or strengthen their credit profiles.

About PRA Group

PRA Group, Inc. is a global financial services company that purchases and collects portfolios of unpaid and charged-off accounts. Its clients include banks, credit card companies and other lenders seeking to manage delinquent accounts and recover outstanding balances. The company’s services include debt portfolio acquisition and account recovery, with collection approaches that may involve direct customer contact, negotiated repayment arrangements and legal processes, subject to applicable regulations.