Atlanticus (NASDAQ:ATLC) versus Bread Financial (NYSE:BFH) Critical Survey

Bread Financial (NYSE:BFHGet Free Report) and Atlanticus (NASDAQ:ATLCGet Free Report) are both small-cap business services companies, but which is the better stock? We will contrast the two companies based on the strength of their analyst recommendations, profitability, institutional ownership, risk, dividends, valuation and earnings.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Bread Financial and Atlanticus, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Bread Financial 4 7 1 0 1.75
Atlanticus 0 1 2 0 2.67

Bread Financial currently has a consensus price target of $35.00, suggesting a potential downside of 1.66%. Atlanticus has a consensus price target of $42.33, suggesting a potential upside of 40.60%. Given Atlanticus’ stronger consensus rating and higher probable upside, analysts plainly believe Atlanticus is more favorable than Bread Financial.

Profitability

This table compares Bread Financial and Atlanticus’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Bread Financial 13.87% 26.24% 3.34%
Atlanticus 8.90% 27.93% 4.06%

Volatility & Risk

Bread Financial has a beta of 1.94, suggesting that its share price is 94% more volatile than the S&P 500. Comparatively, Atlanticus has a beta of 1.86, suggesting that its share price is 86% more volatile than the S&P 500.

Institutional & Insider Ownership

99.5% of Bread Financial shares are owned by institutional investors. Comparatively, 13.8% of Atlanticus shares are owned by institutional investors. 0.2% of Bread Financial shares are owned by insiders. Comparatively, 52.4% of Atlanticus shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Bread Financial and Atlanticus’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Bread Financial $4.30 billion 0.41 $718.00 million $14.32 2.49
Atlanticus $1.16 billion 0.38 $102.85 million $4.23 7.12

Bread Financial has higher revenue and earnings than Atlanticus. Bread Financial is trading at a lower price-to-earnings ratio than Atlanticus, indicating that it is currently the more affordable of the two stocks.

About Bread Financial

(Get Free Report)

Bread Financial Holdings, Inc. provides tech-forward payment and lending solutions to customers and consumer-based industries in North America. It offers credit card and other loans financing services, including risk management solutions, account origination, and funding services for private label and co-brand credit card programs, as well as through Bread partnerships; and Comenity-branded general purpose cash-back credit. The company also manages and services the loans it originates for private label, co-brand, and general-purpose credit card programs, and installment loans and split-pay products; and provides marketing, and data and analytics services. In addition, it offers an enhanced digital suite that includes a unified software development kit, which provides access to its suite of products, as well as promotes credit payment options earlier in the shopping experience. Further, the company through Bread, a digital payments platform and robust suite of application programming interfaces allows merchants and partners to integrate online point-of-sale financing and other digital payment products. It offers its products under the Bread CashbackTM, Bread PayTM, and Bread SavingsTM brands. The company was formerly known as Alliance Data Systems Corporation and changed its name to Bread Financial Holdings, Inc. in March 2022. Bread Financial Holdings, Inc. was incorporated in 1995 and is headquartered in Columbus, Ohio.

About Atlanticus

(Get Free Report)

Atlanticus Holdings Corporation, a financial technology company, provides credit and related financial services and products to customers the United States. It operates in two segments, Credit as a Service, and Auto Finance. The Credit as a Service segment originates a range of consumer loan products, such as private label and general purpose credit cards originated by lenders through various channels, including retail and healthcare, direct mail solicitation, digital marketing, and partnerships with third parties; and offers credit to their customers for the purchase of various goods and services, including consumer electronics, furniture, elective medical procedures, healthcare, and home-improvements by partnering with retailers, healthcare providers, and other service providers. This segment also offers loan servicing, such as risk management and customer service outsourcing for third parties; and engages in testing and investment activities in consumer finance technology platforms. The Auto Finance segment purchases and/or services loans secured by automobiles from or for a pre-qualified network of independent automotive dealers and automotive finance companies in the buy-here, pay-here, and used car business. This segment also provides floor plan financing and installment lending products. It also invests in and services portfolios of credit card receivables. The company was founded in 1996 and is headquartered in Atlanta, Georgia.

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