Head-To-Head Comparison: Performant Financial (PFMT) and TMS International (TMS)

Performant Financial (NASDAQ: PFMT) and TMS International (NYSE:TMS) are both small-cap business services companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, risk, profitability, institutional ownership, earnings, analyst recommendations and valuation.

Analyst Recommendations

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This is a breakdown of current recommendations and price targets for Performant Financial and TMS International, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Performant Financial 0 0 1 0 3.00
TMS International 0 0 0 0 N/A

Performant Financial presently has a consensus price target of $3.50, suggesting a potential upside of 11.46%. Given Performant Financial’s higher possible upside, analysts clearly believe Performant Financial is more favorable than TMS International.

Profitability

This table compares Performant Financial and TMS International’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Performant Financial -9.64% -11.97% -5.75%
TMS International N/A N/A N/A

Valuation and Earnings

This table compares Performant Financial and TMS International’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Performant Financial $132.05 million 1.22 -$12.72 million ($0.19) -16.53
TMS International N/A N/A N/A N/A N/A

TMS International has lower revenue, but higher earnings than Performant Financial.

Institutional & Insider Ownership

58.5% of Performant Financial shares are owned by institutional investors. 33.6% of Performant Financial shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Summary

Performant Financial beats TMS International on 5 of the 8 factors compared between the two stocks.

Performant Financial Company Profile

Performant Financial Corporation provides technology-enabled audit, recovery, customer care, and related analytics services in the United States. The company offers recovery services primarily to the government-supported student loan industry, serving guaranty agencies, the Department of Education, and private financial institutions; and restructures and recovers student loans issued directly by banks to students outside of federal lending programs. It also provides audit and recovery services related to improper payments in the healthcare market; and recovery and risk management advisory services to the Department of the Treasury and various financial institutions, as well as to several federal, state, and municipal tax authorities. In addition, the company offers services from post-and pre-payment audit of healthcare claims to detection of fraud, waste and abuse of healthcare claims, to coordination of benefits and pharmacy fraud detection. The company was formerly known as DCS Holdings, Inc. and changed its name to Performant Financial Corporation in 2005. Performant Financial Corporation was founded in 1976 and is headquartered in Livermore, California.

TMS International Company Profile

TMS International Corp. (TMS), formerly Metal Services Acquisition Corp., is a provider of outsourced industrial services to steel mills in North America. The Company provides a range of services through two segments: Mill Services Group and Raw Material and Optimization Group. The Mill Services Group segment includes scrap management and preparation; semi-finished and finished material handling; metal recovery and slag handling, processing and sales, and surface conditioning. The Raw Material and Optimization Group segment include raw materials procurement and logistics, and software-based raw materials cost optimization. The Company is a holding company controlled by Onex, and it operates through its wholly-owned subsidiaries, including its primary operating company Tube City IMS, LLC. It operates at 74 customer sites in nine countries across North America, Europe and Latin America, and its global raw materials procurement network spans five continents.

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