Comparing X Financial (NYSE:XYF) & Upbound Group (NASDAQ:UPBD)

Upbound Group (NASDAQ:UPBD) and X Financial (NYSE:XYF) are both small-cap finance companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, dividends, earnings, analyst recommendations, profitability, institutional ownership and risk.

Earnings & Valuation

This table compares Upbound Group and X Financial”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Upbound Group	$4.70 billion	0.30	$73.24 million	$1.90	12.76
X Financial	$1.09 billion	0.20	$209.43 million	$1.96	2.92

X Financial has lower revenue, but higher earnings than Upbound Group. X Financial is trading at a lower price-to-earnings ratio than Upbound Group, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Upbound Group and X Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Upbound Group	2.36%	33.81%	7.79%
X Financial	9.94%	9.14%	5.20%

Dividends

Upbound Group pays an annual dividend of $1.56 per share and has a dividend yield of 6.4%. X Financial pays an annual dividend of $0.54 per share and has a dividend yield of 9.4%. Upbound Group pays out 82.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. X Financial pays out 27.6% of its earnings in the form of a dividend. Upbound Group has raised its dividend for 5 consecutive years. X Financial is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional & Insider Ownership

90.3% of Upbound Group shares are owned by institutional investors. Comparatively, 1.1% of X Financial shares are owned by institutional investors. 1.2% of Upbound Group shares are owned by company insiders. Comparatively, 31.6% of X Financial shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Volatility and Risk

Upbound Group has a beta of 1.8, indicating that its share price is 80% more volatile than the S&P 500. Comparatively, X Financial has a beta of 0.47, indicating that its share price is 53% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Upbound Group and X Financial, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Upbound Group	0	3	1	0	2.25
X Financial	0	1	0	0	2.00

Upbound Group currently has a consensus price target of $27.00, suggesting a potential upside of 11.39%. Given Upbound Group’s stronger consensus rating and higher probable upside, analysts clearly believe Upbound Group is more favorable than X Financial.

Summary

Upbound Group beats X Financial on 11 of the 17 factors compared between the two stocks.

About Upbound Group

Upbound Group, Inc. leases household durable goods to customers on a lease-to-own basis in the United States, Puerto Rico, and Mexico. It operates through four segments: Rent-A-Center, Acima, Mexico, and Franchising. The company's brands, such as Rent-A-Center and Acima that facilitate consumer transactions across a range of store-based and virtual channels. It offers furniture comprising mattresses, tires, consumer electronics, appliances, tools, handbags, computers, smartphones, and accessories. It also provides merchandise on an installment sales basis; and the lease-to-own transaction to consumers who do not qualify for traditional financing, the lease to-own transaction through staffed or unstaffed kiosks located in third-party retailer's locations, and other virtual options. It operates retail installment sales stores under the Get It Now and Home Choice names; lease-to-own and franchised lease-to-own stores under the Rent-A-Centre, ColorTyme, and RimTyme names; and company-owned stores and e-commerce platform through rentacenter.com. The company was formerly known as Rent-A-Center, Inc. and changed its name to Upbound Group, Inc. in February 2023. Upbound Group, Inc. was founded in 1960 and is based in Plano, Texas.

About X Financial

X Financial provides personal finance services in the People’s Republic of China. The company offers services as an online marketplace connecting borrowers and investors or institutional funding partners. Its loan products include Xiaoying credit loan, which consists of Xiaoying card loan; and Xiaoying preferred loan to small business owners. The company also offers Xiaoying housing loan, a home equity loan product for property owners; investment products through Xiaoying wealth management platform, such as funds, money market, and insurance products; and loan facilitation services to other platforms. In addition, it engages in the technology development, service, and sale of products; and provision of guarantee and consulting services. The company was incorporated in 2014 and is headquartered in Shenzhen, the People’s Republic of China.