Navient (NASDAQ:NAVI) & Capital One Financial (NYSE:COF) Head-To-Head Contrast

Navient (NASDAQ:NAVI) and Capital One Financial (NYSE:COF) are both finance companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, dividends, analyst recommendations, institutional ownership, earnings, risk and profitability.

Earnings and Valuation

This table compares Navient and Capital One Financial”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Navient	$4.43 billion	0.26	$131.00 million	($0.54)	-21.70
Capital One Financial	$48.23 billion	2.89	$4.75 billion	$2.37	91.91

Capital One Financial has higher revenue and earnings than Navient. Navient is trading at a lower price-to-earnings ratio than Capital One Financial, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Navient has a beta of 1.33, suggesting that its stock price is 33% more volatile than the S&P 500. Comparatively, Capital One Financial has a beta of 1.19, suggesting that its stock price is 19% more volatile than the S&P 500.

Dividends

Navient pays an annual dividend of $0.64 per share and has a dividend yield of 5.5%. Capital One Financial pays an annual dividend of $2.40 per share and has a dividend yield of 1.1%. Navient pays out -118.5% of its earnings in the form of a dividend. Capital One Financial pays out 101.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Navient is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares Navient and Capital One Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Navient	-1.48%	4.12%	0.21%
Capital One Financial	2.24%	10.94%	1.66%

Insider & Institutional Ownership

97.1% of Navient shares are held by institutional investors. Comparatively, 89.8% of Capital One Financial shares are held by institutional investors. 31.2% of Navient shares are held by company insiders. Comparatively, 1.3% of Capital One Financial shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Navient and Capital One Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Navient	5	4	0	1	1.70
Capital One Financial	0	6	15	4	2.92

Navient currently has a consensus target price of $12.83, indicating a potential upside of 9.50%. Capital One Financial has a consensus target price of $261.63, indicating a potential upside of 20.11%. Given Capital One Financial’s stronger consensus rating and higher probable upside, analysts clearly believe Capital One Financial is more favorable than Navient.

Summary

Capital One Financial beats Navient on 12 of the 17 factors compared between the two stocks.

About Navient

Navient Corporation provides technology-enabled education finance and business processing solutions for education, health care, and government clients in the United States. It operates through three segments: Federal Education Loans, Consumer Lending, and Business Processing. The company owns Federal Family Education Loan Program (FFELP) loans that are insured or guaranteed by state or not-for-profit agencies; and performs servicing on its portfolios, as well as federal education loans held by other institutions. It also owns, originates, and services refinance and in-school private education loans; and offers business processing solutions, such as omnichannel contact center, workflow processing, and revenue cycle optimization services to federal agencies, state governments, tolling and parking authorities, other public sector clients, as well as hospitals, hospital systems, medical centers, large physician groups, other healthcare providers, and public health departments. In addition, the company provides corporate liquidity portfolio services. Navient Corporation was founded in 1973 and is headquartered in Herndon, Virginia.

About Capital One Financial

Capital One Financial Corporation operates as the financial services holding company for the Capital One, National Association, which engages in the provision of various financial products and services in the United States, Canada, and the United Kingdom. It operates through three segments: Credit Card, Consumer Banking, and Commercial Banking. The company accepts checking accounts, money market deposits, negotiable order of withdrawals, savings deposits, and time deposits. Its loan products include credit card loans; auto and retail banking loans; and commercial and multifamily real estate, and commercial and industrial loans. The company also offers credit and debit card products; online direct banking services; and provides advisory, capital markets, treasury management, and depository services. It serves consumers, small businesses, and commercial clients through digital channels, branches, cafés, and other distribution channels located in New York, Louisiana, Texas, Maryland, Virginia, New Jersey, and California. The company was founded in 1988 and is headquartered in McLean, Virginia.