Consumer Portfolio Services (NASDAQ:CPSS – Get Free Report) and SLM (NASDAQ:SLM – Get Free Report) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, earnings, analyst recommendations, valuation, institutional ownership, dividends and risk.
Valuation and Earnings
This table compares Consumer Portfolio Services and SLM”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Consumer Portfolio Services | $434.47 million | 0.47 | $19.33 million | $0.92 | 10.34 |
| SLM | $2.63 billion | 2.01 | $744.85 million | $3.58 | 7.83 |
Volatility and Risk
Consumer Portfolio Services has a beta of 1.13, suggesting that its share price is 13% more volatile than the S&P 500. Comparatively, SLM has a beta of 0.96, suggesting that its share price is 4% less volatile than the S&P 500.
Institutional & Insider Ownership
47.6% of Consumer Portfolio Services shares are held by institutional investors. Comparatively, 98.9% of SLM shares are held by institutional investors. 63.7% of Consumer Portfolio Services shares are held by insiders. Comparatively, 1.4% of SLM shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Analyst Ratings
This is a summary of current ratings and target prices for Consumer Portfolio Services and SLM, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Consumer Portfolio Services | 0 | 1 | 0 | 0 | 2.00 |
| SLM | 1 | 6 | 5 | 0 | 2.33 |
SLM has a consensus price target of $29.80, indicating a potential upside of 6.31%. Given SLM’s stronger consensus rating and higher possible upside, analysts clearly believe SLM is more favorable than Consumer Portfolio Services.
Profitability
This table compares Consumer Portfolio Services and SLM’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Consumer Portfolio Services | 4.78% | 6.91% | 0.54% |
| SLM | 26.09% | 33.81% | 2.51% |
Summary
SLM beats Consumer Portfolio Services on 11 of the 14 factors compared between the two stocks.
About Consumer Portfolio Services
Consumer Portfolio Services, Inc. operates as a specialty finance company in the United States. It is involved in the purchase and service of 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 or past credit problems. It also serves as an alternative source of financing for dealers, facilitating sales to customers who are not able to obtain financing from commercial banks, credit unions, and the captive finance companies. In addition, the company acquires installment purchase contracts in merger and acquisition transactions; purchases immaterial amounts of vehicle purchase money loans from non-affiliated lenders. It services its automobile contracts through its branches in California, Nevada, Virginia, Florida, and Illinois. The company was incorporated in 1991 and is based in Las Vegas, Nevada.
About SLM
SLM Corporation, through its subsidiaries, originates and services private education loans to students and their families to finance the cost of their education in the United States. It is also involved in the provision of retail deposit accounts, including certificates of deposit, money market accounts, and high-yield savings accounts; and interest-bearing omnibus accounts. The company was formerly known as New BLC Corporation and changed its name to SLM Corporation in December 2013. SLM Corporation was founded in 1972 and is headquartered in Newark, Delaware.
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