Financial Survey: Elevate Credit (ELVT) versus Harvest Capital Credit (HCAP)

Elevate Credit (NYSE: ELVT) and Harvest Capital Credit (NASDAQ:HCAP) are both small-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, earnings, profitability, dividends, analyst recommendations, risk and institutional ownership.

Profitability

This table compares Elevate Credit and Harvest Capital Credit’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Elevate Credit 0.13% 12.91% 2.02%
Harvest Capital Credit 7.70% 9.62% 6.17%

Analyst Ratings

This is a breakdown of current recommendations for Elevate Credit and Harvest Capital Credit, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Elevate Credit 0 2 4 0 2.67
Harvest Capital Credit 0 2 0 0 2.00

Elevate Credit currently has a consensus target price of $10.00, indicating a potential upside of 18.76%. Harvest Capital Credit has a consensus target price of $12.00, indicating a potential upside of 18.11%. Given Elevate Credit’s stronger consensus rating and higher probable upside, analysts clearly believe Elevate Credit is more favorable than Harvest Capital Credit.

Valuation and Earnings

This table compares Elevate Credit and Harvest Capital Credit’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Elevate Credit $673.13 million 0.52 -$6.91 million $0.16 52.63
Harvest Capital Credit $18.70 million 3.47 $1.63 million $1.28 7.94

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

Dividends

Harvest Capital Credit pays an annual dividend of $1.14 per share and has a dividend yield of 11.2%. Elevate Credit does not pay a dividend. Harvest Capital Credit pays out 89.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Institutional and Insider Ownership

42.8% of Elevate Credit shares are owned by institutional investors. Comparatively, 5.6% of Harvest Capital Credit shares are owned by institutional investors. 32.0% of Elevate Credit shares are owned by company insiders. Comparatively, 9.3% of Harvest Capital Credit shares are owned 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

Elevate Credit beats Harvest Capital Credit on 9 of the 15 factors compared between the two stocks.

Elevate Credit Company Profile

Elevate Credit, Inc. provides online credit solutions to non-prime consumers in the United States and the United Kingdom. The company offers unsecured online installment loans and lines of credit. Its products include Rise installment loan and line of credit products; Elastic, a line of credit product; and Sunny installment loan products. Elevate Credit, Inc. was incorporated in 2014 and is headquartered in Fort Worth, Texas.

Harvest Capital Credit Company Profile

Harvest Capital Credit Corporation is an externally managed, closed-end, non-diversified management investment company. The Company operates as a business development company and provides customized financing solutions for small to mid-sized companies. Its investment objective is to generate both current income and capital appreciation by making direct investments in the form of subordinated debt, senior debt, and to a lesser extent, minority equity investments in privately-held the United States small to mid-sized companies. Its investment portfolio includes over 56.8% of senior secured term loans, 40.8% of junior secured term loans, 1.3% of equity investments and 1.1% of collateralized loan obligation (CLO) equity at fair value. It may also invest in other investments, such as loans to larger, publicly-traded companies, high-yield bonds and distressed debt securities. It may also invest in debt and equity securities issued by CLO funds. HCAP Advisors LLC is its investment adviser.

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