Forward Industries (NASDAQ:FWDI – Get Free Report) and PennyMac Financial Services (NYSE:PFSI – Get Free Report) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, institutional ownership, analyst recommendations, risk, dividends, earnings and valuation.
Insider and Institutional Ownership
57.9% of PennyMac Financial Services shares are owned by institutional investors. 15.9% of Forward Industries shares are owned by company insiders. Comparatively, 15.2% of PennyMac Financial Services shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
Risk and Volatility
Forward Industries has a beta of 0.88, indicating that its share price is 12% less volatile than the S&P 500. Comparatively, PennyMac Financial Services has a beta of 1.44, indicating that its share price is 44% more volatile than the S&P 500.
Analyst Ratings
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Forward Industries | 1 | 1 | 3 | 0 | 2.40 |
| PennyMac Financial Services | 2 | 4 | 4 | 0 | 2.20 |
Forward Industries presently has a consensus price target of $8.50, suggesting a potential upside of 23.91%. PennyMac Financial Services has a consensus price target of $104.88, suggesting a potential upside of 45.45%. Given PennyMac Financial Services’ higher probable upside, analysts plainly believe PennyMac Financial Services is more favorable than Forward Industries.
Profitability
This table compares Forward Industries and PennyMac Financial Services’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Forward Industries | -2,073.82% | -18.05% | -17.03% |
| PennyMac Financial Services | 17.74% | 11.18% | 1.65% |
Dividends
Forward Industries pays an annual dividend of $0.42 per share and has a dividend yield of 6.2%. PennyMac Financial Services pays an annual dividend of $1.20 per share and has a dividend yield of 1.7%. Forward Industries pays out 351.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. PennyMac Financial Services pays out 16.5% of its earnings in the form of a dividend. PennyMac Financial Services has raised its dividend for 1 consecutive years.
Earnings and Valuation
This table compares Forward Industries and PennyMac Financial Services”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Forward Industries | $53.12 million | 9.54 | -$166.97 million | $0.12 | 57.17 |
| PennyMac Financial Services | $2.05 billion | 1.83 | $501.08 million | $7.28 | 9.90 |
PennyMac Financial Services has higher revenue and earnings than Forward Industries. PennyMac Financial Services is trading at a lower price-to-earnings ratio than Forward Industries, indicating that it is currently the more affordable of the two stocks.
Summary
PennyMac Financial Services beats Forward Industries on 12 of the 17 factors compared between the two stocks.
About Forward Industries
Forward Industries, Inc., together with its subsidiaries, designs, markets, and distributes carry and protective solutions primarily for handheld electronic devices. The company operates in three segments: OEM Distribution, Retail Distribution, and Design. The OEM Distribution segment sources and distributes carrying cases and other accessories for medical monitoring and diagnostic kits; and various portable electronic and non-electronic products, such as sporting and recreational products, bar code scanners, GPS devices, tablets, and firearms. The Retail Distribution segment sources and sells smart-enabled furniture and a range of other products through agreements with various retailers, including in stores and online retailer websites. The Design segment provides hardware and software product design and engineering services. The company sells its products to original equipment manufacturers in the Asia-Pacific, the Americas, Europe, the Middle East, and Africa. Forward Industries, Inc. was incorporated in 1961 and is headquartered in Hauppauge, New York.
About PennyMac Financial Services
PennyMac Financial Services, Inc., through its subsidiaries, engages in the mortgage banking and investment management activities in the United States. The company operates through three segments: Production, Servicing, and Investment Management. The Production segment is involved in the origination, acquisition, and sale of loans. This segment sources residential conventional and government-insured or guaranteed mortgage loans through correspondent production, consumer direct lending, and broker direct lending. The Servicing segment performs loan servicing for both newly originated loans that are under holding for sale and loans services for others. The segment performs loan administration, collection, and default management activities, including the collection and remittance of loan payments; responds to customer inquiries; provides accounting for principal and interest; holds custodial funds for the payment of property taxes and insurance premiums; counsels delinquent borrowers; and supervising foreclosures and property dispositions, as well as administers loss mitigation activities, such as modification and forbearance programs. The Investment Management segment is involved in sourcing, performing diligence, bidding, and closing investment asset acquisitions; managing correspondent production activities for PennyMac Mortgage Investment Trust; and managing acquired assets. The company was founded in 2008 and is headquartered in Westlake Village, California.
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