PPDAI Group (NYSE:FINV) vs. SLM (NASDAQ:SLM) Head to Head Survey

SLM (NASDAQ:SLM) and PPDAI Group (NYSE:FINV) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their earnings, valuation, dividends, profitability, risk, analyst recommendations and institutional ownership.

Analyst Ratings

This is a summary of recent ratings and target prices for SLM and PPDAI Group, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SLM	1	5	5	0	2.36
PPDAI Group	1	1	0	0	1.50

SLM currently has a consensus price target of $26.44, indicating a potential upside of 57.17%. PPDAI Group has a consensus price target of $4.10, indicating a potential upside of 48.50%. Given SLM’s stronger consensus rating and higher possible upside, equities analysts plainly believe SLM is more favorable than PPDAI Group.

Risk and Volatility

SLM has a beta of 1.01, meaning that its stock price is 1% more volatile than the S&P 500. Comparatively, PPDAI Group has a beta of 0.31, meaning that its stock price is 69% less volatile than the S&P 500.

Valuation and Earnings

This table compares SLM and PPDAI Group”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SLM	$2.63 billion	1.17	$744.85 million	$2.76	6.10
PPDAI Group	$1.94 billion	0.35	$363.56 million	$1.06	2.60

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

Profitability

This table compares SLM and PPDAI Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SLM	20.43%	26.34%	1.93%
PPDAI Group	14.49%	12.31%	7.95%

Institutional and Insider Ownership

98.9% of SLM shares are held by institutional investors. Comparatively, 31.1% of PPDAI Group shares are held by institutional investors. 1.4% of SLM shares are held by company insiders. Comparatively, 44.0% of PPDAI Group shares are held 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.

Summary

SLM beats PPDAI Group on 12 of the 14 factors compared between the two stocks.

About SLM

SLM Corporation, commonly known as Sallie Mae, is a U.S.-based education finance company. Through Sallie Mae Bank, it primarily provides private student loans to undergraduate and graduate students, as well as loans for career training and other education-related expenses. The company also offers consumer banking products, including savings accounts and certificates of deposit. Its services include supporting borrowers through loan application, repayment and customer service processes. Founded in 1972 as the Student Loan Marketing Association, the organization was later privatized and became known as Sallie Mae.

About PPDAI Group

PPDAI Group, now known as FinVolution Group, operates an online consumer finance platform that connects individual borrowers with financial institutions and other funding partners. The company uses technology and data analytics to support borrower assessment, risk management and loan facilitation. Founded in China, the company has expanded beyond its home market into countries in Southeast Asia, including Indonesia and the Philippines. Its platform serves consumers seeking credit and partners seeking technology-enabled access to consumer lending opportunities.