Head-To-Head Comparison: Home Capital Group (OTCMKTS:HMCBF) vs. Home Point Capital (NASDAQ:HMPT)

Home Point Capital (NASDAQ:HMPT) and Home Capital Group (OTCMKTS:HMCBF) are both financial services companies, but which is the better investment? We will compare the two companies based on the strength of their profitability, institutional ownership, analyst recommendations, dividends, risk, earnings and valuation.

Profitability

This table compares Home Point Capital and Home Capital Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Home Point Capital	-63.98%	-29.08%	-6.07%
Home Capital Group	N/A	N/A	N/A

Insider & Institutional Ownership

93.7% of Home Point Capital shares are held by institutional investors. Comparatively, 37.0% of Home Capital Group shares are held by institutional investors. 2.1% of Home Point Capital shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares Home Point Capital and Home Capital Group’s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Home Point Capital	$255.60 million	1.26	-$163.45 million	($2.24)	-1.04
Home Capital Group	N/A	N/A	N/A	$4.06	8.00

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

Analyst Ratings

This is a summary of recent recommendations and price targets for Home Point Capital and Home Capital Group, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Home Point Capital	1	3	1	0	2.00
Home Capital Group	0	2	1	0	2.33

Home Point Capital presently has a consensus price target of $2.04, suggesting a potential downside of 12.00%. Home Capital Group has a consensus price target of $39.00, suggesting a potential upside of 19.93%. Given Home Capital Group’s stronger consensus rating and higher possible upside, analysts plainly believe Home Capital Group is more favorable than Home Point Capital.

Summary

Home Capital Group beats Home Point Capital on 7 of the 10 factors compared between the two stocks.

About Home Point Capital

Home Point Capital Inc., together with its subsidiaries, operates as a residential mortgage originator and service provider. It operates through two segments, Origination and Servicing. The Origination segment sources loans through direct and wholesale. The Servicing segment offers collecting loan payments, remitting payments to investors, sending monthly statements, managing escrow accounts, servicing delinquent loan work-outs, and managing and disposing of foreclosed properties. The company was incorporated in 2014 and is headquartered in Ann Arbor, Michigan. As of July 31, 2023, Home Point Capital Inc. operates as a subsidiary of Mr. Cooper Group Inc.

About Home Capital Group

Home Capital Group Inc., through its subsidiary, Home Trust Company, provides residential and non-residential mortgage lending, securitization of residential mortgage products, consumer lending, and credit card services in Canada. The company provides various lending and savings solutions. It offers deposits through brokers and financial planners under the Oaken Financial brand. The company also provides credit card and line of credit services, include Equityline Visa product, a home equity line of credit that is secured by residential property; and cash-secured and unsecured credit card products. In addition, it offers consumer retail lending services for durable household goods, such as water heaters and larger-ticket home improvement items; and consumer loans. Further, the company manages a treasury portfolio. The company was founded in 1986 and is based in Toronto, Canada.