Navient (NASDAQ:NAVI) and Capital Financial (NASDAQ:CPFH) Critical Review

Navient (NASDAQ:NAVI) and Capital Financial (OTCMKTS:CPFH) are both finance companies, but which is the better investment? We will compare the two companies based on the strength of their profitability, institutional ownership, analyst recommendations, dividends, risk, earnings and valuation.

Valuation & Earnings

This table compares Navient and Capital Financial’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Navient $5.61 billion 0.57 $395.00 million $2.09 6.87
Capital Financial $15.07 million 0.06 -$290,000.00 N/A N/A

Navient has higher revenue and earnings than Capital Financial.

Volatility and Risk

Navient has a beta of 2.15, meaning that its stock price is 115% more volatile than the S&P 500. Comparatively, Capital Financial has a beta of -1.66, meaning that its stock price is 266% less volatile than the S&P 500.

Insider and Institutional Ownership

95.5% of Navient shares are held by institutional investors. 1.9% of Navient shares are held by company insiders. Comparatively, 54.0% of Capital Financial shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Navient and Capital Financial’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Navient 8.80% 17.50% 0.59%
Capital Financial -2.80% -123.36% -7.99%

Dividends

Navient pays an annual dividend of $0.64 per share and has a dividend yield of 4.5%. Capital Financial pays an annual dividend of $50.00 per share and has a dividend yield of 5.5%. Navient pays out 30.6% of its earnings in the form of a dividend.

Analyst Ratings

This is a summary of recent recommendations and price targets for Navient and Capital Financial, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Navient 0 4 2 0 2.33
Capital Financial 0 0 0 0 N/A

Navient presently has a consensus price target of $15.80, suggesting a potential upside of 10.03%. Given Navient’s higher possible upside, research analysts plainly believe Navient is more favorable than Capital Financial.

Summary

Navient beats Capital Financial on 10 of the 13 factors compared between the two stocks.

Navient Company Profile

Navient Corporation provides education loan management and business processing solutions for education, healthcare, and government clients at the federal, state, and local levels in the United States. It operates in three segments: Federal Education Loans, Consumer Lending, and Business Processing. The company holds and acquires Federal Family Education Loan Program loans that are insured or guaranteed by state or not-for-profit agencies; and performs servicing and asset recovery services on its own loan portfolio, and federal education loans owned by the United States Department of Education and other institutions. It also holds, originates, and acquires consumer loans; and performs servicing activities on its own education loan portfolio, including primarily private education loans, and private education refinance loans. In addition, the company offers revenue cycle management and business processing services; and healthcare services that include revenue cycle outsourcing, accounts receivable management, extended business office support, and consulting engagement for federal, state, and municipal clients; public authorities; and healthcare organizations. Further, it provides customizable solutions for its clients that include non-profit/religious-affiliated hospital systems, teaching hospitals, urban medical centers, for-profit healthcare systems, critical access hospitals, children's hospitals, and various physician groups. The company was founded in 1973 and is headquartered in Wilmington, Delaware.

Capital Financial Company Profile

Capital Financial Holdings, Inc., a full-service brokerage firm, provides investment products and services to independent investment representatives, financial planners, and investment advisors in the United States. It offers mutual funds, insurance products, and various other securities, as well as investment advisory services. The company was formerly known as Integrity Mutual Funds, Inc. and changed its name to Capital Financial Holdings, Inc. in May 2009. Capital Financial Holdings, Inc. was founded in 1987 and is headquartered in Minot, North Dakota.

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