Analyzing Nationstar Mortgage (NSM) & PSM HOLDINGS In/SH (PSMH)

Nationstar Mortgage (NYSE:NSM) and PSM HOLDINGS In/SH (OTCMKTS:PSMH) are both small-cap finance companies, but which is the better stock? We will compare the two businesses based on the strength of their valuation, risk, institutional ownership, analyst recommendations, earnings, profitability and dividends.

Insider & Institutional Ownership

97.0% of Nationstar Mortgage shares are held by institutional investors. 1.1% of Nationstar Mortgage shares are held by company insiders. Comparatively, 71.1% of PSM HOLDINGS In/SH shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Nationstar Mortgage and PSM HOLDINGS In/SH, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Nationstar Mortgage 2 0 2 0 2.00
PSM HOLDINGS In/SH 0 0 0 0 N/A

Nationstar Mortgage presently has a consensus price target of $17.00, suggesting a potential downside of 6.95%. Given Nationstar Mortgage’s higher probable upside, analysts plainly believe Nationstar Mortgage is more favorable than PSM HOLDINGS In/SH.

Earnings & Valuation

This table compares Nationstar Mortgage and PSM HOLDINGS In/SH’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Nationstar Mortgage $1.65 billion 1.09 $30.00 million $1.48 12.34
PSM HOLDINGS In/SH N/A N/A N/A N/A N/A

Nationstar Mortgage has higher revenue and earnings than PSM HOLDINGS In/SH.

Risk & Volatility

Nationstar Mortgage has a beta of 1.09, meaning that its share price is 9% more volatile than the S&P 500. Comparatively, PSM HOLDINGS In/SH has a beta of 5.9, meaning that its share price is 490% more volatile than the S&P 500.

Profitability

This table compares Nationstar Mortgage and PSM HOLDINGS In/SH’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Nationstar Mortgage 14.19% 10.28% 1.01%
PSM HOLDINGS In/SH N/A N/A N/A

Summary

Nationstar Mortgage beats PSM HOLDINGS In/SH on 7 of the 9 factors compared between the two stocks.

About Nationstar Mortgage

Nationstar Mortgage Holdings Inc. provides servicing, origination, and transaction based services primarily to single-family residences in the United States. It operates in three segments: Servicing, Originations, and Xome. The Servicing segment offers conventional residential mortgage loans and home equity conversion loans. It engages in the collection and recording of mortgage payments, administration of mortgage escrow accounts, negotiations of workouts and modifications, and conducting or managing the foreclosure on behalf of investors or other servicers for owned mortgage servicing rights. This segment also provides various services that include collecting monthly payments, maintaining escrow accounts, providing periodic reports, and managing insurance. The Originations segment operates an integrated residential loan origination platform that is primarily focused on customer retention. This segment originates and purchases conventional mortgage loans and government-insured mortgage loans. Its platform also serves as a loss mitigation solution for servicing clients and customers by offering refinancing options to borrowers. The Xome segment provides technology and data-enhanced solutions to home buyers, home sellers, real estate professionals, and companies. It offers Xome Exchange, a technology-enabled platform that manages and sells residential properties; Xome Services, which connects the touch points of the real estate transactions process by providing title, escrow, and collateral valuation services for purchase, refinance, and default transactions; and a software as a service platform that provides integrated technology, media, and data solutions to real estate franchisors, brokerages, agents, and multiple listing service organizations and associations. The company was founded in 1994 and is headquartered in Coppell, Texas.

About PSM HOLDINGS In/SH

PSM Holdings, Inc. originates mortgage loans in the United States. It funds its mortgage loans either directly off its warehouse lines of credit or through brokering transactions to other third parties. The company solicits and receives applications for secured residential mortgage loans; and provides mortgage banking services. It operates through a network of approximately 26 offices located in Arizona, Arkansas, California, Colorado, Florida, Kansas, Missouri, Montana, New Jersey, New Mexico, North Dakota, Oklahoma, Oregon, Texas, Utah, Washington, and Virginia. The company is based in Murrieta, California.

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