Comparing Vroom (NASDAQ:VRM) & PROG (NYSE:PRG)

PROG (NYSE:PRG) and Vroom (NASDAQ:VRM) are both small-cap finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, profitability, earnings, risk, analyst recommendations, institutional ownership and dividends.

Earnings and Valuation

This table compares PROG and Vroom”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
PROG	$2.41 billion	0.65	$146.79 million	$3.62	10.87
Vroom	$178.83 million	0.27	-$7.96 million	($11.12)	-0.83

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

Risk and Volatility

PROG has a beta of 1.79, meaning that its share price is 79% more volatile than the S&P 500. Comparatively, Vroom has a beta of 1.23, meaning that its share price is 23% more volatile than the S&P 500.

Profitability

This table compares PROG and Vroom’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
PROG	5.57%	21.88%	9.15%
Vroom	-32.38%	-47.65%	-5.59%

Institutional and Insider Ownership

97.9% of PROG shares are owned by institutional investors. Comparatively, 25.8% of Vroom shares are owned by institutional investors. 3.7% of PROG shares are owned by insiders. Comparatively, 2.9% of Vroom shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings and price targets for PROG and Vroom, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
PROG	0	3	6	1	2.80
Vroom	1	0	0	0	1.00

PROG currently has a consensus price target of $49.44, indicating a potential upside of 25.60%. Given PROG’s stronger consensus rating and higher possible upside, equities research analysts plainly believe PROG is more favorable than Vroom.

Summary

PROG beats Vroom on 15 of the 15 factors compared between the two stocks.

About PROG

PROG Holdings, Inc. (NYSE:PRG) is a financial technology holding company based in Salt Lake City, Utah with three business segments: Progressive Leasing, which offers lease-to-own transactions primarily to credit-challenged consumers through e-commerce and point-of-sale retail partners, via online, mobile, and in-store solutions; Vive Financial, which provides consumers who may not qualify for traditional prime lending with a variety of second-look, revolving credit products through private label and branded credit cards; and Four Technologies, which provides consumers of all credit backgrounds Buy Now, Pay Later (BNPL) options through four interest-free installments via its platform, Four.

About Vroom

Vroom, Inc. operates as an automotive finance company. The company offers vehicle financing to its customers through third party dealers under the UACC brand. It also provides artificial intelligence powered analytics and digital services to dealers, automotive financial services companies, and others in the automotive industry for automotive retail. The company was formerly known as Auto America, Inc. and changed its name to Vroom, Inc. in July 2015. Vroom, Inc. was incorporated in 2012 and is based in Houston, Texas.