WSFS Financial Corporation (NASDAQ: WSFS) and Ocwen Financial Corporation (NYSE:OCN) are both small-cap finance companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, profitability, dividends, valuation and risk.

Risk & Volatility

WSFS Financial Corporation has a beta of 1.22, indicating that its share price is 22% more volatile than the S&P 500. Comparatively, Ocwen Financial Corporation has a beta of 1.27, indicating that its share price is 27% more volatile than the S&P 500.

Earnings & Valuation

This table compares WSFS Financial Corporation and Ocwen Financial Corporation’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
WSFS Financial Corporation $307.38 million 5.19 $69.12 million $2.20 23.07
Ocwen Financial Corporation $1.32 billion 0.39 $352.81 million ($0.62) -6.27

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

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for WSFS Financial Corporation and Ocwen Financial Corporation, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
WSFS Financial Corporation 0 0 3 0 3.00
Ocwen Financial Corporation 0 5 0 0 2.00

WSFS Financial Corporation currently has a consensus target price of $51.33, suggesting a potential upside of 1.15%. Ocwen Financial Corporation has a consensus target price of $3.33, suggesting a potential downside of 14.31%. Given WSFS Financial Corporation’s stronger consensus rating and higher possible upside, research analysts clearly believe WSFS Financial Corporation is more favorable than Ocwen Financial Corporation.

Profitability

This table compares WSFS Financial Corporation and Ocwen Financial Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
WSFS Financial Corporation 19.96% 10.44% 1.08%
Ocwen Financial Corporation -5.95% -12.41% -1.01%

Institutional and Insider Ownership

78.4% of WSFS Financial Corporation shares are owned by institutional investors. Comparatively, 48.5% of Ocwen Financial Corporation shares are owned by institutional investors. 4.9% of WSFS Financial Corporation shares are owned by company insiders. Comparatively, 2.4% of Ocwen Financial Corporation shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Dividends

WSFS Financial Corporation pays an annual dividend of $0.28 per share and has a dividend yield of 0.6%. Ocwen Financial Corporation does not pay a dividend. WSFS Financial Corporation pays out 12.7% of its earnings in the form of a dividend.

Summary

WSFS Financial Corporation beats Ocwen Financial Corporation on 11 of the 15 factors compared between the two stocks.

About WSFS Financial Corporation

WSFS Financial Corporation is a savings and loan holding company. The Company’s subsidiary is Wilmington Savings Fund Society, FSB (WSFS Bank or the Bank), which is the bank and trust company. It operates in three segments: WSFS Bank, Cash Connect and Wealth Management. The WSFS Bank segment provides loans and other financial products to commercial and retail customers. Its Cash Connect segment provides automated teller machine (ATM) services through strategic partnerships with several of the network, manufacturers and service providers in the ATM industry. The Wealth Management segment provides a range of fiduciary, investment management, credit and deposit products to clients. Its banking business is commercial lending funded by customer-generated deposits. It also offers a range of consumer loan products, retail securities and insurance brokerage services. Its subsidiaries include WSFS Wealth Investments, 1832 Holdings, Inc., Monarch and West Capital Management.

About Ocwen Financial Corporation

Ocwen Financial Corporation is a financial services holding company. The Company, through its subsidiaries, originates and services loans. The Company’s segments include Servicing, Lending, and Corporate Items and Other. The Company’s Servicing segment consists of its residential servicing business. The Company’s Lending segment is focused on originating and purchasing conventional and government-insured residential forward and reverse mortgage loans. The Company’s Corporate Items and Other segment includes revenues and expenses of Automotive Capital Services (ACS) and its other business activities. Its servicing clients include some of the financial institutions in the United States, including the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac), the Government National Mortgage Association (Ginnie Mae) and non-Agency residential mortgage-backed securities (RMBS) trusts.

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