Pagaya Technologies (NASDAQ:PGY – Get Free Report) and LexinFintech (NASDAQ:LX – Get Free Report) are both small-cap finance companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, valuation, earnings, profitability, dividends, analyst recommendations and institutional ownership.
Volatility & Risk
Pagaya Technologies has a beta of 6.33, indicating that its stock price is 533% more volatile than the S&P 500. Comparatively, LexinFintech has a beta of 0.53, indicating that its stock price is 47% less volatile than the S&P 500.
Earnings & Valuation
This table compares Pagaya Technologies and LexinFintech”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Pagaya Technologies | $891.47 million | 1.36 | -$128.44 million | ($1.97) | -8.57 |
| LexinFintech | $1.84 billion | 0.32 | $150.14 million | $0.67 | 5.37 |
Analyst Recommendations
This is a summary of current recommendations and price targets for Pagaya Technologies and LexinFintech, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Pagaya Technologies | 0 | 2 | 7 | 0 | 2.78 |
| LexinFintech | 0 | 1 | 0 | 0 | 2.00 |
Pagaya Technologies currently has a consensus price target of $22.89, indicating a potential upside of 35.52%. LexinFintech has a consensus price target of $2.12, indicating a potential downside of 41.11%. Given Pagaya Technologies’ stronger consensus rating and higher possible upside, research analysts plainly believe Pagaya Technologies is more favorable than LexinFintech.
Profitability
This table compares Pagaya Technologies and LexinFintech’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Pagaya Technologies | -14.58% | -3.10% | -1.55% |
| LexinFintech | 5.80% | 8.16% | 3.46% |
Insider & Institutional Ownership
57.1% of Pagaya Technologies shares are held by institutional investors. 19.7% of Pagaya Technologies shares are held by company insiders. Comparatively, 27.8% of LexinFintech shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Summary
LexinFintech beats Pagaya Technologies on 8 of the 14 factors compared between the two stocks.
About Pagaya Technologies
Pagaya Technologies Ltd., a product-focused technology company, deploys data science and proprietary artificial intelligence-powered technology for financial institutions and investors in the United States, Israel, the Cayman Islands, and internationally. The company develops and implements proprietary artificial intelligence technology and related software solutions to assist partners to originate loans and other assets. Its partners include high-growth financial technology companies, incumbent banks and financial institutions, auto finance providers, and residential real estate service providers. Pagaya Technologies Ltd. was incorporated in 2016 and is headquartered in New York, New York.
About LexinFintech
LexinFintech Holdings Ltd., through its subsidiaries, provides online consumer finance services in the People's Republic of China. The company operates Fenqile.com, an online consumption and consumer finance platform that offers installment purchase and personal installment loans, as well as online direct sales with installment payment terms; and Le Hua Card, a scenario-based lending. It also provides technology-driven platform services for financial institution customers and partners to increase revenues, manage financial risks, enhance operating efficiency and service quality, enhance collections, and reduce overall costs; Maiya application, a location-based services shopping experience with buy-now and pay-later options; and Juzi Licai, an online investment platform. In addition, the company offers technical support and consulting, software development, financing guarantee, and financial technology services. The company was formerly known as Staging Finance Holding Ltd. and changed its name to LexinFintech Holdings Ltd. in March 2017. LexinFintech Holdings Ltd. was founded in 2013 and is headquartered in Shenzhen, the People's Republic of China.
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