Financial Review: Dave (NASDAQ:DAVE) vs. Futu (NASDAQ:FUTU)

Futu (NASDAQ:FUTU) and Dave (NASDAQ:DAVE) are both business services companies, but which is the superior business? We will contrast the two businesses based on the strength of their valuation, profitability, dividends, risk, institutional ownership, earnings and analyst recommendations.

Risk & Volatility

Futu has a beta of 0.2, indicating that its stock price is 80% less volatile than the S&P 500. Comparatively, Dave has a beta of 3.9, indicating that its stock price is 290% more volatile than the S&P 500.

Earnings and Valuation

This table compares Futu and Dave”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Futu	$20.84 billion	1.11	$700.73 million	$8.93	18.58
Dave	$347.10 million	7.23	$57.87 million	$10.09	18.43

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

Institutional & Insider Ownership

18.0% of Dave shares are held by institutional investors. 35.2% of Futu shares are held by company insiders. Comparatively, 28.5% of Dave 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.

Profitability

This table compares Futu and Dave’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Futu	47.11%	30.59%	5.03%
Dave	29.85%	65.86%	41.56%

Analyst Ratings

This is a breakdown of current ratings and target prices for Futu and Dave, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Futu	0	2	6	2	3.00
Dave	0	2	10	0	2.83

Futu currently has a consensus price target of $203.67, suggesting a potential upside of 22.72%. Dave has a consensus price target of $304.25, suggesting a potential upside of 63.58%. Given Dave’s higher probable upside, analysts clearly believe Dave is more favorable than Futu.

Summary

Dave beats Futu on 8 of the 15 factors compared between the two stocks.

About Futu

Futu Holdings Limited provides digitalized securities brokerage and wealth management product distribution service in Hong Kong and internationally. It offers online financial services, including securities and derivative trades brokerage, margin financing and fund distribution services through its Futubull and Moomoo digital platforms. The company also provides financial information and online community services; online wealth management services under the Money Plus brand name through its Futubull and moomoo platforms, which provides its client access to mutual funds, private funds, bonds, structured products, and other wealth management products; market data and information services; and NiuNiu Community, which serves as an open forum for users and clients to share insights, ask questions, and exchange ideas. Futu Holdings Limited was founded in 2007 and is headquartered in Sheung Wan, Hong Kong.

About Dave

Dave, Inc. is a digital banking service. Its products include a budgeting tool to help members manage their upcoming bills to avoid overspending, cash advances through its flagship ExtraCash product to help members avoid punitive overdraft fees, a Side Hustle product, where Dave helps connect members with supplemental work opportunities, and Dave Banking, a modern checking account experience with valuable tools for building long-term financial health. The company was founded by Jason Wilk, Paras Chitrakar, and John Wolanin in October 2015 and is headquartered in Los Angeles, CA.