Head to Head Review: X Financial (NYSE:XYF) & Pearl Diver Credit (NYSE:PDCC)

Pearl Diver Credit (NYSE:PDCC) and X Financial (NYSE:XYF) are both small-cap finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their valuation, institutional ownership, analyst recommendations, dividends, profitability, risk and earnings.

Insider and Institutional Ownership

1.2% of X Financial shares are owned by institutional investors. 31.6% of X Financial shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of current recommendations for Pearl Diver Credit and X Financial, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Pearl Diver Credit	0	0	0	1	4.00
X Financial	0	1	0	0	2.00

Pearl Diver Credit presently has a consensus price target of $19.50, indicating a potential upside of 39.29%. Given Pearl Diver Credit’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Pearl Diver Credit is more favorable than X Financial.

Valuation and Earnings

This table compares Pearl Diver Credit and X Financial”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Pearl Diver Credit	N/A	N/A	N/A	N/A	N/A
X Financial	$804.43 million	0.31	$210.97 million	$5.66	1.06

X Financial has higher revenue and earnings than Pearl Diver Credit.

Volatility & Risk

Pearl Diver Credit has a beta of 0.35, meaning that its stock price is 65% less volatile than the S&P 500. Comparatively, X Financial has a beta of 0.37, meaning that its stock price is 63% less volatile than the S&P 500.

Dividends

Pearl Diver Credit pays an annual dividend of $2.64 per share and has a dividend yield of 18.9%. X Financial pays an annual dividend of $0.48 per share and has a dividend yield of 8.0%. X Financial pays out 8.5% of its earnings in the form of a dividend.

Profitability

This table compares Pearl Diver Credit and X Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Pearl Diver Credit	N/A	N/A	N/A
X Financial	22.75%	24.56%	14.10%

Summary

X Financial beats Pearl Diver Credit on 7 of the 12 factors compared between the two stocks.

About Pearl Diver Credit

Pearl Diver Credit Company Inc. is a newly organized, externally managed, non-diversified, closed-end management investment company. Its primary investment objective is to maximize its portfolio’s total return, with a secondary objective of generating high current income. Pearl Diver Credit Company Inc. is based in NEW YORK.

About X Financial

X Financial provides personal finance services in the People’s Republic of China. The company offers services as an online marketplace connecting borrowers and investors or institutional funding partners. Its loan products include Xiaoying credit loan, which consists of Xiaoying card loan; and Xiaoying preferred loan to small business owners. The company also offers Xiaoying housing loan, a home equity loan product for property owners; investment products through Xiaoying wealth management platform, such as funds, money market, and insurance products; and loan facilitation services to other platforms. In addition, it engages in the technology development, service, and sale of products; and provision of guarantee and consulting services. The company was incorporated in 2014 and is headquartered in Shenzhen, the People’s Republic of China.