Contrasting Walter Investment Management Corp. (WAC) and Meta Financial Group (CASH)
Walter Investment Management Corp. (NYSE: WAC) and Meta Financial Group (NASDAQ:CASH) are both small-cap retail & mortgage banks companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, analyst recommendations, risk, valuation, institutional ownership, profitability and dividends.
Risk & Volatility
Walter Investment Management Corp. has a beta of 0.78, indicating that its share price is 22% less volatile than the S&P 500. Comparatively, Meta Financial Group has a beta of 0.89, indicating that its share price is 11% less volatile than the S&P 500.
Meta Financial Group pays an annual dividend of $0.52 per share and has a dividend yield of 0.6%. Walter Investment Management Corp. does not pay a dividend. Meta Financial Group pays out 10.7% of its earnings in the form of a dividend.
Earnings and Valuation
This table compares Walter Investment Management Corp. and Meta Financial Group’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Walter Investment Management Corp.||$995.72 million||0.02||-$833.85 million||($7.20)||-0.06|
|Meta Financial Group||$280.27 million||2.98||$33.22 million||$4.84||17.94|
Meta Financial Group has higher revenue, but lower earnings than Walter Investment Management Corp.. Walter Investment Management Corp. is trading at a lower price-to-earnings ratio than Meta Financial Group, indicating that it is currently the more affordable of the two stocks.
This is a summary of recent ratings for Walter Investment Management Corp. and Meta Financial Group, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Walter Investment Management Corp.||1||1||0||0||1.50|
|Meta Financial Group||0||0||3||0||3.00|
Walter Investment Management Corp. presently has a consensus price target of $1.13, indicating a potential upside of 150.00%. Meta Financial Group has a consensus price target of $92.67, indicating a potential upside of 6.70%. Given Walter Investment Management Corp.’s higher probable upside, research analysts clearly believe Walter Investment Management Corp. is more favorable than Meta Financial Group.
This table compares Walter Investment Management Corp. and Meta Financial Group’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Walter Investment Management Corp.||-18.10%||-796.24%||-0.52%|
|Meta Financial Group||16.03%||15.91%||1.50%|
Institutional and Insider Ownership
56.7% of Walter Investment Management Corp. shares are owned by institutional investors. Comparatively, 73.9% of Meta Financial Group shares are owned by institutional investors. 46.6% of Walter Investment Management Corp. shares are owned by insiders. Comparatively, 6.1% of Meta Financial Group shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Meta Financial Group beats Walter Investment Management Corp. on 11 of the 15 factors compared between the two stocks.
About Walter Investment Management Corp.
Walter Investment Management Corp. is a diversified mortgage banking firm focused primarily on the servicing and origination of residential loans, including reverse loans. The Company operates through three segments: Servicing, Originations and Reverse Mortgage. The Servicing segment consists of operations that perform servicing for third-party credit owners of mortgage loans, as well as its own mortgage loan portfolio. The Servicing segment also includes Insurance, and Loans and Residuals businesses. The Originations segment consists of operations that originate and purchase mortgage loans that are intended for sale to third parties. The Reverse Mortgage segment consists of operations which purchases and originates home equity conversion mortgage that are securitized, but remain on the consolidated balance sheet as collateral for secured borrowings.
About Meta Financial Group
Meta Financial Group, Inc. is a unitary savings and loan holding company. The Company operates through its banking subsidiary, MetaBank (the Bank). Its segments include Payments, Banking, and Corporate Services/Other. MetaBank is both a community-oriented financial institution offering a range of financial services to meet the needs of the communities it serves and a payments company providing services on a nationwide basis. It operates in both the banking and payments industries through MetaBank, its retail banking operation; Meta Payment Systems (MPS), its electronic payments division; AFS/IBEX Financial Services Inc. (AFS/IBEX), its insurance premium financing division, and Refund Advantage, EPS Financial, LLC (EPS) Financial and Specialty Consumer Services, its tax-related financial solutions divisions.
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