Critical Analysis: Vroom (NASDAQ:VRM) & Regional Management (NYSE:RM)

Regional Management (NYSE:RMGet Free Report) and Vroom (NASDAQ:VRMGet Free Report) are both small-cap finance companies, but which is the better stock? We will compare the two companies based on the strength of their analyst recommendations, institutional ownership, valuation, profitability, dividends, risk and earnings.

Profitability

This table compares Regional Management and Vroom’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Regional Management 6.98% 12.49% 2.25%
Vroom -32.38% -47.65% -5.59%

Insider and Institutional Ownership

98.9% of Regional Management shares are held by institutional investors. Comparatively, 25.8% of Vroom shares are held by institutional investors. 10.9% of Regional Management shares are held by insiders. Comparatively, 2.9% of Vroom shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings and target prices for Regional Management and Vroom, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Regional Management 0 2 2 0 2.50
Vroom 1 0 0 0 1.00

Regional Management currently has a consensus price target of $43.00, suggesting a potential upside of 25.51%. Given Regional Management’s stronger consensus rating and higher probable upside, research analysts plainly believe Regional Management is more favorable than Vroom.

Valuation and Earnings

This table compares Regional Management and Vroom”s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Regional Management $645.60 million 0.49 $44.41 million $4.75 7.21
Vroom $178.83 million 0.30 -$7.96 million ($11.12) -0.92

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

Volatility and Risk

Regional Management has a beta of 1.02, suggesting that its stock price is 2% more volatile than the S&P 500. Comparatively, Vroom has a beta of 1.23, suggesting that its stock price is 23% more volatile than the S&P 500.

Summary

Regional Management beats Vroom on 13 of the 14 factors compared between the two stocks.

About Regional Management

(Get Free Report)

Regional Management Corp., a diversified consumer finance company, provides various installment loan products primarily to customers with limited access to consumer credit from banks, thrifts, credit card companies, and other lenders in the United States. It offers small and large installment loans; and retail loans to finance the purchase of furniture, appliances, and other retail products. The company also provides insurance products, including credit life, credit accident and health, credit property, vehicle single interest, and credit involuntary unemployment insurance; collateral protection insurance; and property insurance, as well as reinsurance products. In addition, its loans are sourced through branches, centrally-managed direct mail campaigns, and digital partners, as well as its consumer website. The company was incorporated in 1987 and is headquartered in Greer, South Carolina.

About Vroom

(Get Free Report)

Vroom, Inc. operates as an automotive finance company. The company offers vehicle financing to its customers through third party dealers under the UACC brand. It also provides artificial intelligence powered analytics and digital services to dealers, automotive financial services companies, and others in the automotive industry for automotive retail. The company was formerly known as Auto America, Inc. and changed its name to Vroom, Inc. in July 2015. Vroom, Inc. was incorporated in 2012 and is based in Houston, Texas.

Receive News & Ratings for Regional Management Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Regional Management and related companies with MarketBeat.com's FREE daily email newsletter.