Contrasting Newtek Business Services Corp. (NEWT) & Its Competitors

Newtek Business Services Corp. (NASDAQ: NEWT) is one of 31 public companies in the “Transaction & Payment Services” industry, but how does it contrast to its rivals? We will compare Newtek Business Services Corp. to related businesses based on the strength of its valuation, analyst recommendations, earnings, profitability, dividends, risk and institutional ownership.

Earnings and Valuation

This table compares Newtek Business Services Corp. and its rivals revenue, earnings per share and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Newtek Business Services Corp. $35.85 million $2.91 million 9.04
Newtek Business Services Corp. Competitors $1.59 billion $466.83 million 29.25

Newtek Business Services Corp.’s rivals have higher revenue and earnings than Newtek Business Services Corp.. Newtek Business Services Corp. is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Profitability

This table compares Newtek Business Services Corp. and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Newtek Business Services Corp. 81.35% 7.97% 4.23%
Newtek Business Services Corp. Competitors 10.83% 16.94% 5.58%

Analyst Ratings

This is a summary of current ratings and recommmendations for Newtek Business Services Corp. and its rivals, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Newtek Business Services Corp. 0 3 0 0 2.00
Newtek Business Services Corp. Competitors 119 704 1046 12 2.51

Newtek Business Services Corp. currently has a consensus target price of $18.00, indicating a potential upside of 5.94%. As a group, “Transaction & Payment Services” companies have a potential upside of 10.19%. Given Newtek Business Services Corp.’s rivals stronger consensus rating and higher possible upside, analysts clearly believe Newtek Business Services Corp. has less favorable growth aspects than its rivals.

Volatility and Risk

Newtek Business Services Corp. has a beta of 1.39, suggesting that its stock price is 39% more volatile than the S&P 500. Comparatively, Newtek Business Services Corp.’s rivals have a beta of 1.30, suggesting that their average stock price is 30% more volatile than the S&P 500.

Institutional & Insider Ownership

22.8% of Newtek Business Services Corp. shares are owned by institutional investors. Comparatively, 56.6% of shares of all “Transaction & Payment Services” companies are owned by institutional investors. 6.7% of Newtek Business Services Corp. shares are owned by company insiders. Comparatively, 17.9% of shares of all “Transaction & Payment Services” companies are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Dividends

Newtek Business Services Corp. pays an annual dividend of $1.76 per share and has a dividend yield of 10.4%. Newtek Business Services Corp. pays out 93.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Transaction & Payment Services” companies pay a dividend yield of 1.9% and pay out 60.3% of their earnings in the form of a dividend.

Summary

Newtek Business Services Corp. rivals beat Newtek Business Services Corp. on 12 of the 15 factors compared.

Newtek Business Services Corp. Company Profile

Newtek Business Services Corp. is an internally managed non-diversified closed-end management investment company. The Company’s investment objective is to generate both current income and capital appreciation primarily through loans originated by its small business finance platform and its equity investments in certain portfolio companies that it controls. The Company is a national non-bank lender that provides, together with its controlled portfolio companies, a range of business services and financial products under the Newtek brand to the small and medium-sized business (SMB) market. The Company issues debt and makes equity investments in portfolio companies in various industries. Its products and services include Business Lending including the United States Small Business Administration (SBA) 7(a) and 504 lending, Electronic Payment Processing, Managed Technology Solutions (Cloud Computing), Data Backup, and Payroll and Benefits Solutions to SMB accounts across all industries.

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