Critical Survey: Lendingclub (HAPN) versus Its Rivals

Lendingclub (NASDAQ:HAPN) is one of 121 public companies in the “Consumer Finance” industry, but how does it compare to its peers? We will compare Lendingclub to related businesses based on the strength of its risk, dividends, analyst recommendations, earnings, valuation, institutional ownership and profitability.

Institutional and Insider Ownership

74.1% of Lendingclub shares are owned by institutional investors. Comparatively, 46.4% of shares of all “Consumer Finance” companies are owned by institutional investors. 3.3% of Lendingclub shares are owned by company insiders. Comparatively, 21.8% of shares of all “Consumer Finance” companies are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Lendingclub and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Lendingclub	18.67%	12.92%	1.66%
Lendingclub Competitors	9.58%	-32.60%	2.28%

Analyst Ratings

This is a summary of recent recommendations and price targets for Lendingclub and its peers, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lendingclub	0	1	2	0	2.67
Lendingclub Competitors	905	3380	5274	269	2.50

Lendingclub currently has a consensus target price of $25.00, suggesting a potential upside of 42.21%. As a group, “Consumer Finance” companies have a potential upside of 11.80%. Given Lendingclub’s stronger consensus rating and higher probable upside, research analysts plainly believe Lendingclub is more favorable than its peers.

Risk and Volatility

Lendingclub has a beta of 1.91, meaning that its stock price is 91% more volatile than the S&P 500. Comparatively, Lendingclub’s peers have a beta of 1.24, meaning that their average stock price is 24% more volatile than the S&P 500.

Valuation & Earnings

This table compares Lendingclub and its peers gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Lendingclub	$998.85 million	$135.68 million	10.59
Lendingclub Competitors	$3.57 billion	$381.70 million	6.79

Lendingclub’s peers have higher revenue and earnings than Lendingclub. Lendingclub is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Summary

Lendingclub beats its peers on 8 of the 13 factors compared.

About Lendingclub

LendingClub Corporation, operates as a bank holding company for LendingClub Bank, National Association that provides range of financial products and services through a technology-driven platform in the United States. The company provides commercial and industrial, commercial real estate, small business, and equipment loans, as well as leases equipment; and unsecured personal and auto, patient finance, and education finance loans. It also operates an online lending marketplace platform that connects borrowers and investors. LendingClub Corporation was incorporated in 2006 and is headquartered in San Francisco, California.