Atlanticus (NASDAQ:ATLC) and Santander Consumer USA (NYSE:SC) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, institutional ownership, risk, valuation, earnings, profitability and analyst recommendations.

Profitability

This table compares Atlanticus and Santander Consumer USA’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Atlanticus -21.62% N/A -7.51%
Santander Consumer USA 20.54% 13.25% 2.22%

Volatility & Risk

Atlanticus has a beta of 0.08, meaning that its stock price is 92% less volatile than the S&P 500. Comparatively, Santander Consumer USA has a beta of 1.09, meaning that its stock price is 9% more volatile than the S&P 500.

Insider and Institutional Ownership

14.9% of Atlanticus shares are held by institutional investors. 33.1% of Atlanticus shares are held by insiders. Comparatively, 0.1% of Santander Consumer USA shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Dividends

Santander Consumer USA pays an annual dividend of $0.80 per share and has a dividend yield of 4.3%. Atlanticus does not pay a dividend. Santander Consumer USA pays out 46.0% of its earnings in the form of a dividend.

Analyst Recommendations

This is a summary of recent ratings and target prices for Atlanticus and Santander Consumer USA, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Atlanticus 0 0 0 0 N/A
Santander Consumer USA 0 7 6 0 2.46

Santander Consumer USA has a consensus target price of $23.00, suggesting a potential upside of 24.46%. Given Santander Consumer USA’s higher possible upside, analysts clearly believe Santander Consumer USA is more favorable than Atlanticus.

Earnings & Valuation

This table compares Atlanticus and Santander Consumer USA’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Atlanticus $121.14 million 0.41 -$40.78 million N/A N/A
Santander Consumer USA $6.56 billion 1.01 $1.19 billion $1.74 10.62

Santander Consumer USA has higher revenue and earnings than Atlanticus.

Summary

Santander Consumer USA beats Atlanticus on 10 of the 13 factors compared between the two stocks.

About Atlanticus

Atlanticus Holdings Corporation provides credit and related financial services and products to financially underserved consumer credit market in the United States. It operates in two segments, Credit and Other Investments, and Auto Finance. The Credit and Other Investments segment originates a range of consumer loan products, such as retail credit, personal loans, and credit cards through various channels, including retail point-of-sale, direct mail solicitation, Internet-based marketing, and partnerships with third parties; and offers point-of-sale financing by partnering with retailers and service providers to provide credit to their customers for the purchase of various goods and services. This segment also invests in and services portfolios of credit card receivables. In addition, this segment offers loan servicing, such as risk management and customer service outsourcing for third parties; and engages in testing and investment activities in consumer finance technology platforms. The Auto Finance segment purchases and/or services loans secured by automobiles from or for a pre-qualified network of independent automotive dealers and automotive finance companies in the buy-here, pay-here, and used car business. This segment also provides floor plan financing and installment lending products. The company was formerly known as CompuCredit Holdings Corporation and changed its name to Atlanticus Holdings Corporation in November 2012. Atlanticus Holdings Corporation was founded in 1996 and is headquartered in Atlanta, Georgia.

About Santander Consumer USA

Santander Consumer USA Holdings Inc., a specialized consumer finance company, provides vehicle finance and third-party servicing in the United States. Its products and services include retail installment contracts and vehicle leases, as well as dealer loans for inventory, construction, real estate, working capital, and revolving lines of credit. The company also offers financial products and services related to motorcycles, recreational vehicles, and marine vehicles; originates vehicle loans through a Web-based direct lending program; purchases vehicle retail installment contracts from other lenders; and services automobile, and recreational and marine vehicle portfolios for other lenders. In addition, it provides private-label credit cards and other consumer finance products, as well as point-of-sale financing. The company was founded in 1995 and is headquartered in Dallas, Texas. Santander Consumer USA Holdings Inc. is a subsidiary of Santander Holdings USA, Inc.

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