Analyzing Regional Management (NYSE:RM) & Bread Financial (NYSE:BFH)

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

Earnings & Valuation

This table compares Bread Financial and Regional Management’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Bread Financial $5.17 billion 0.33 $718.00 million $14.32 2.44
Regional Management $551.40 million 0.43 $15.96 million $1.64 14.65

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

Volatility & Risk

Bread Financial has a beta of 1.93, suggesting that its stock price is 93% more volatile than the S&P 500. Comparatively, Regional Management has a beta of 1.47, suggesting that its stock price is 47% more volatile than the S&P 500.

Insider & Institutional Ownership

99.5% of Bread Financial shares are held by institutional investors. Comparatively, 98.9% of Regional Management shares are held by institutional investors. 0.3% of Bread Financial shares are held by company insiders. Comparatively, 9.8% of Regional Management shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Bread Financial and Regional Management’s 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%
Regional Management 2.89% 8.85% 1.64%

Dividends

Bread Financial pays an annual dividend of $0.84 per share and has a dividend yield of 2.4%. Regional Management pays an annual dividend of $1.20 per share and has a dividend yield of 5.0%. Bread Financial pays out 5.9% of its earnings in the form of a dividend. Regional Management pays out 73.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Analyst Ratings

This is a summary of current recommendations and price targets for Bread Financial and Regional Management, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Bread Financial 4 7 1 0 1.75
Regional Management 0 2 0 0 2.00

Bread Financial presently has a consensus price target of $35.00, suggesting a potential upside of 0.03%. Regional Management has a consensus price target of $29.00, suggesting a potential upside of 20.68%. Given Regional Management’s stronger consensus rating and higher probable upside, analysts clearly believe Regional Management is more favorable than Bread Financial.

Summary

Bread Financial beats Regional Management on 10 of the 16 factors compared between 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 Regional Management

(Get Free Report)

Regional Management Corp., a diversified consumer finance company, engages in the provision of various installment loan products primarily to customers with limited access to consumer credit from banks, thrifts, credit card companies, and other lenders in the United States. It offers small and large installment loans secured by non-essential household goods and/or vehicles; and retail loans to finance the purchase of furniture, appliances, and other retail products. The company also provides insurance products, including credit life, accident and health, involuntary unemployment, and personal property insurance, as well as vehicle single interest, credit, and collateral protection insurance; and reinsurance products. In addition, its loans are sourced through branches, centrally managed direct mail campaigns, and digital partners, as well as its consumer website. The company was incorporated in 1987 and is headquartered in Greer, South Carolina.

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