Encore Capital Group (NASDAQ:ECPG – Get Free Report) and Capital One Financial (NYSE:COF – Get Free Report) are both finance companies, but which is the better business? We will compare the two companies based on the strength of their dividends, valuation, earnings, analyst recommendations, profitability, institutional ownership and risk.
Profitability
This table compares Encore Capital Group and Capital One Financial’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Encore Capital Group | -8.38% | 16.18% | 2.99% |
| Capital One Financial | 9.65% | 9.63% | 1.21% |
Analyst Recommendations
This is a breakdown of current recommendations and price targets for Encore Capital Group and Capital One Financial, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Encore Capital Group | 0 | 0 | 3 | 1 | 3.25 |
| Capital One Financial | 0 | 4 | 12 | 2 | 2.89 |
Volatility and Risk
Encore Capital Group has a beta of 1.59, suggesting that its share price is 59% more volatile than the S&P 500. Comparatively, Capital One Financial has a beta of 1.15, suggesting that its share price is 15% more volatile than the S&P 500.
Earnings & Valuation
This table compares Encore Capital Group and Capital One Financial”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Encore Capital Group | $1.32 billion | 0.69 | -$139.24 million | ($4.89) | -7.92 |
| Capital One Financial | $53.94 billion | 1.53 | $4.75 billion | $11.91 | 18.14 |
Capital One Financial has higher revenue and earnings than Encore Capital Group. Encore Capital Group is trading at a lower price-to-earnings ratio than Capital One Financial, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
89.8% of Capital One Financial shares are owned by institutional investors. 2.6% of Encore Capital Group shares are owned by insiders. Comparatively, 1.3% of Capital One Financial shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
Summary
Capital One Financial beats Encore Capital Group on 9 of the 15 factors compared between the two stocks.
About Encore Capital Group
Encore Capital Group, Inc., a specialty finance company, provides debt recovery solutions and other related services for consumers across financial assets worldwide. The company purchases portfolios of defaulted consumer receivables at deep discounts to face value, as well as manages them by working with individuals as they repay their obligations and works toward financial recovery. It is also involved in the provision of early stage collection, business process outsourcing, and contingent collection services. In addition, the company engages in debt servicing and other portfolio management services to credit originator for non-performing loans. Further, it offers credit management services. Encore Capital Group, Inc. was incorporated in 1999 and is headquartered in San Diego, California.
About Capital One Financial
Capital One Financial Corporation operates as the financial services holding company for the Capital One, National Association, which engages in the provision of various financial products and services in the United States, Canada, and the United Kingdom. It operates through three segments: Credit Card, Consumer Banking, and Commercial Banking. The company accepts checking accounts, money market deposits, negotiable order of withdrawals, savings deposits, and time deposits. Its loan products include credit card loans; auto and retail banking loans; and commercial and multifamily real estate, and commercial and industrial loans. The company also offers credit and debit card products; online direct banking services; and provides advisory, capital markets, treasury management, and depository services. It serves consumers, small businesses, and commercial clients through digital channels, branches, cafés, and other distribution channels located in New York, Louisiana, Texas, Maryland, Virginia, New Jersey, and California. The company was founded in 1988 and is headquartered in McLean, Virginia.
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