Analyzing Consumer Portfolio Services (CPSS) & Elevate Credit (ELVT)

Consumer Portfolio Services (NASDAQ:CPSS) and Elevate Credit (NYSE:ELVT) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, risk, analyst recommendations, earnings, valuation, dividends and institutional ownership.

Analyst Recommendations

This is a summary of current ratings and target prices for Consumer Portfolio Services and Elevate Credit, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Consumer Portfolio Services 0 0 2 0 3.00
Elevate Credit 0 2 4 0 2.67

Consumer Portfolio Services currently has a consensus target price of $5.50, suggesting a potential upside of 54.49%. Elevate Credit has a consensus target price of $11.10, suggesting a potential upside of 70.25%. Given Elevate Credit’s higher possible upside, analysts plainly believe Elevate Credit is more favorable than Consumer Portfolio Services.

Institutional & Insider Ownership

41.7% of Consumer Portfolio Services shares are held by institutional investors. Comparatively, 46.0% of Elevate Credit shares are held by institutional investors. 46.2% of Consumer Portfolio Services shares are held by company insiders. Comparatively, 32.0% of Elevate Credit shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Consumer Portfolio Services and Elevate Credit’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Consumer Portfolio Services $434.38 million 0.19 $3.76 million $0.80 4.45
Elevate Credit $673.13 million 0.42 -$6.91 million $0.16 40.75

Consumer Portfolio Services has higher earnings, but lower revenue than Elevate Credit. Consumer Portfolio Services is trading at a lower price-to-earnings ratio than Elevate Credit, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Consumer Portfolio Services has a beta of 1.73, suggesting that its share price is 73% more volatile than the S&P 500. Comparatively, Elevate Credit has a beta of 1, suggesting that its share price has a similar volatility profile to the S&P 500.

Profitability

This table compares Consumer Portfolio Services and Elevate Credit’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Consumer Portfolio Services 0.24% 8.52% 0.66%
Elevate Credit 0.14% 12.68% 1.97%

Summary

Elevate Credit beats Consumer Portfolio Services on 8 of the 14 factors compared between the two stocks.

Consumer Portfolio Services Company Profile

Consumer Portfolio Services, Inc. operates as a specialty finance company in the United States. It purchases and services retail automobile contracts originated by franchised automobile dealers and select independent dealers in the sale of new and used automobiles, light trucks, and passenger vans. The company, through its automobile contract purchases, offers indirect financing to the customers of dealers with limited credit histories, low incomes, or past credit problems. It serves as an alternative source of financing for dealers, facilitating sales to customers who might not be able to obtain financing from commercial banks, credit unions, and the captive finance companies. The company also acquires installment purchase contracts in four merger and acquisition transactions; and offers financing directly to sub-prime consumers to facilitate their purchase of a new or used automobile, light truck, or passenger van. Consumer Portfolio Services, Inc. services its automobile contracts through its branches in California, Nevada, Virginia, Florida, and Illinois. The company was founded in 1991 and is headquartered in Irvine, California.

Elevate Credit Company Profile

Elevate Credit, Inc. provides online credit solutions to non-prime consumers in the United States and the United Kingdom. The company offers unsecured online installment loans and lines of credit. Its products include Rise installment loan and line of credit products; Elastic, a line of credit product; and Sunny installment loan products. Elevate Credit, Inc. was incorporated in 2014 and is headquartered in Fort Worth, Texas.

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