Contrasting Enova International (ENVA) & Discover Financial Services (DFS)
Enova International (NYSE: ENVA) and Discover Financial Services (NYSE:DFS) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their earnings, profitability, dividends, analyst recommendations, risk, valuation and institutional ownership.
Insider & Institutional Ownership
92.5% of Enova International shares are owned by institutional investors. Comparatively, 86.5% of Discover Financial Services shares are owned by institutional investors. 5.6% of Enova International shares are owned by company insiders. Comparatively, 0.8% of Discover Financial Services shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
This table compares Enova International and Discover Financial Services’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Discover Financial Services||18.43%||22.79%||2.43%|
Earnings & Valuation
This table compares Enova International and Discover Financial Services’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Enova International||$843.74 million||1.41||$29.24 million||$1.15||30.57|
|Discover Financial Services||$11.55 billion||2.28||$2.10 billion||$5.98||12.59|
Discover Financial Services has higher revenue and earnings than Enova International. Discover Financial Services is trading at a lower price-to-earnings ratio than Enova International, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of current ratings and recommmendations for Enova International and Discover Financial Services, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Discover Financial Services||0||8||14||1||2.70|
Enova International currently has a consensus target price of $27.00, indicating a potential downside of 23.19%. Discover Financial Services has a consensus target price of $85.40, indicating a potential upside of 13.39%. Given Discover Financial Services’ higher possible upside, analysts clearly believe Discover Financial Services is more favorable than Enova International.
Risk and Volatility
Enova International has a beta of 2.85, meaning that its stock price is 185% more volatile than the S&P 500. Comparatively, Discover Financial Services has a beta of 1.46, meaning that its stock price is 46% more volatile than the S&P 500.
Discover Financial Services pays an annual dividend of $1.40 per share and has a dividend yield of 1.9%. Enova International does not pay a dividend. Discover Financial Services pays out 23.4% of its earnings in the form of a dividend. Discover Financial Services has raised its dividend for 7 consecutive years.
Discover Financial Services beats Enova International on 11 of the 18 factors compared between the two stocks.
About Enova International
Enova International, Inc., a technology and analytics company, provides online financial services. The company offers short-term consumer loans; line of credit accounts; installment loans; receivables purchase agreements; CSO programs, including credit-related services, such as arranging loans with independent third-party lenders and assisting in the preparation of loan applications and loan documents; and bank programs comprising technology, loan servicing, and marketing services to the bank, as well as Enova Decisions, an analytics as a service that enables companies to take decisions about their customers through existing tools and technologies. It offers loans to consumers under the names CashNetUSA and NetCredit in the United States; QuickQuid, Pounds to Pocket, and On Stride Financial names in the United Kingdom; and Simplic name in Brazil. The company also offers financing to small businesses under the names Headway Capital and The Business Backer in the United States. Enova International, Inc. was founded in 2011 and is headquartered in Chicago, Illinois.
About Discover Financial Services
Discover Financial Services, through its subsidiaries, operates as a direct banking and payment services company in the United States. The Direct Banking segment offers Discover-branded credit cards to individuals; and other consumer products and services, including private student loans, personal loans, home equity loans, and other consumer lending, as well as deposit products, such as certificates of deposit, money market accounts, savings accounts, checking accounts, and individual retirement arrangement certificates of deposit. The Payment Services segment operates the Discover Network, which processes transactions for Discover-branded credit cards, and provides payment transaction processing and settlement services; and PULSE network, an electronic funds transfer network that provides financial institutions issuing debit cards on the PULSE network with access to automated teller machines and point-of-sale terminals. This segment also operates Diners Club International, a payments network that issues Diners Club branded charge cards and provides card acceptance services. The company was incorporated in 1960 and is based in Riverwoods, Illinois.
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