World Acceptance Corporation (NASDAQ: WRLD) and Cash America International (NYSE:CSH) are both small-cap finance companies, but which is the better business? We will contrast the two companies based on the strength of their risk, profitability, earnings, dividends, analyst recommendations, valuation and institutional ownership.
This table compares World Acceptance Corporation and Cash America International’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|World Acceptance Corporation||12.02%||13.90%||7.70%|
|Cash America International||0.87%||0.86%||0.64%|
This is a summary of recent recommendations for World Acceptance Corporation and Cash America International, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|World Acceptance Corporation||3||0||0||0||1.00|
|Cash America International||0||0||0||0||N/A|
World Acceptance Corporation currently has a consensus price target of $59.00, indicating a potential downside of 18.56%. Given World Acceptance Corporation’s higher possible upside, research analysts plainly believe World Acceptance Corporation is more favorable than Cash America International.
Volatility and Risk
World Acceptance Corporation has a beta of 2.43, suggesting that its stock price is 143% more volatile than the S&P 500. Comparatively, Cash America International has a beta of 0.83, suggesting that its stock price is 17% less volatile than the S&P 500.
Earnings & Valuation
This table compares World Acceptance Corporation and Cash America International’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|World Acceptance Corporation||$531.73 million||1.21||$73.60 million||$7.32||9.90|
|Cash America International||N/A||N/A||N/A||$1.18||35.76|
World Acceptance Corporation has higher revenue and earnings than Cash America International. World Acceptance Corporation is trading at a lower price-to-earnings ratio than Cash America International, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
91.8% of World Acceptance Corporation shares are owned by institutional investors. 27.3% of World Acceptance Corporation shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Cash America International pays an annual dividend of $0.32 per share and has a dividend yield of 0.8%. World Acceptance Corporation does not pay a dividend. Cash America International pays out 27.1% of its earnings in the form of a dividend. World Acceptance Corporation has increased its dividend for 2 consecutive years.
World Acceptance Corporation beats Cash America International on 11 of the 12 factors compared between the two stocks.
About World Acceptance Corporation
World Acceptance Corporation operates a small-loan consumer finance business in 15 states and Mexico as of March 31, 2016. The Company offers short-term small installment loans, medium-term larger installment loans, related credit insurance and ancillary products and services to individuals. The Company offers standardized installment loans generally between $300 and $4,000 through 1,339 branches in Alabama, Georgia, Idaho, Illinois, Indiana, Kentucky, Louisiana, Mississippi, Missouri, New Mexico, Oklahoma, South Carolina, Texas, Tennessee, Wisconsin and Mexico as of March 31, 2016. The Company generally serves individuals with limited access to other sources of consumer credit, such as banks, credit unions, other consumer finance businesses and credit card lenders. In the United States branches, the Company also offers income tax return preparation services to its loan customers and other individuals.
About Cash America International
Cash America International, Inc. provides specialty financial services to individuals through its storefront lending and franchised check cashing locations. The Company offers secured non-recourse loans, referred to as pawn loans, as its primary line of business. The Company is also engaged in originating, arranging, guaranteeing or purchasing consumer loans in some of its locations. The Company also offers check cashing and other ancillary products and services, including money orders, wire transfers and auto insurance. The Company’s franchised check cashing business offers check cashing services through its franchised check cashing centers. The Company provides its services in the United States under the names Cash America Pawn, SuperPawn, Cash America Payday Advance, Cashland and Mr. Payroll. The Company is engaged in pawn lending activities, merchandise disposition activities, consumer loan activities and check cashing and other financial services.
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