Head to Head Review: Mr. Cooper Group (NASDAQ:COOP) and Upstart (NASDAQ:UPST)

Mr. Cooper Group (NASDAQ:COOPGet Rating) and Upstart (NASDAQ:UPSTGet Rating) are both finance companies, but which is the superior business? We will compare the two businesses based on the strength of their risk, institutional ownership, analyst recommendations, dividends, valuation, earnings and profitability.

Profitability

This table compares Mr. Cooper Group and Upstart’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Mr. Cooper Group 39.35% 11.01% 2.55%
Upstart 8.48% 11.50% 4.96%

Analyst Ratings

This is a summary of recent ratings and recommmendations for Mr. Cooper Group and Upstart, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Mr. Cooper Group 0 2 2 0 2.50
Upstart 5 6 2 0 1.77

Mr. Cooper Group currently has a consensus price target of $57.25, indicating a potential upside of 42.73%. Upstart has a consensus price target of $88.38, indicating a potential upside of 260.31%. Given Upstart’s higher probable upside, analysts clearly believe Upstart is more favorable than Mr. Cooper Group.

Risk & Volatility

Mr. Cooper Group has a beta of 1.5, meaning that its stock price is 50% more volatile than the S&P 500. Comparatively, Upstart has a beta of 1.05, meaning that its stock price is 5% more volatile than the S&P 500.

Institutional & Insider Ownership

86.7% of Mr. Cooper Group shares are held by institutional investors. Comparatively, 44.8% of Upstart shares are held by institutional investors. 2.6% of Mr. Cooper Group shares are held by company insiders. Comparatively, 18.9% of Upstart shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Mr. Cooper Group and Upstart’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Mr. Cooper Group $3.32 billion 0.87 $1.45 billion $15.92 2.52
Upstart $848.59 million 2.35 $135.44 million $0.89 27.56

Mr. Cooper Group has higher revenue and earnings than Upstart. Mr. Cooper Group is trading at a lower price-to-earnings ratio than Upstart, indicating that it is currently the more affordable of the two stocks.

Summary

Mr. Cooper Group beats Upstart on 7 of the 13 factors compared between the two stocks.

About Mr. Cooper Group

(Get Rating)

Mr. Cooper Group Inc. provides servicing, origination, and transaction-based services related to single-family residences in the United States. The company operates through two segments: Servicing and Originations. The Servicing segment performs activities for underlying mortgages, including collecting and disbursing borrower payments, investor reporting, customer service, and modifying loans. The Originations segment originates residential mortgage loans through its direct-to-consumer channel, as well as originates and purchases loans from mortgage bankers and brokers. It operates primarily under the Mr. Cooper and Xome brands. The company was formerly known as WMIH Corp. and changed its name to Mr. Cooper Group Inc. in October 2018. Mr. Cooper Group Inc. was incorporated in 2015 and is based in Coppell, Texas.

About Upstart

(Get Rating)

Upstart Holdings, Inc., together with its subsidiaries, operates a cloud-based artificial intelligence (AI) lending platform in the United States. Its platform aggregates consumer demand for loans and connects it to its network of the company's AI-enabled bank partners. The company was founded in 2012 and is headquartered in San Mateo, California.

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