Critical Analysis: Hexindai (NASDAQ:HX) versus Its Competitors

Hexindai (NASDAQ: HX) is one of 38 public companies in the “Nondepository credit institutions” industry, but how does it compare to its peers? We will compare Hexindai to similar businesses based on the strength of its risk, valuation, profitability, dividends, analyst recommendations, earnings and institutional ownership.

Dividends

Hexindai pays an annual dividend of $0.25 per share and has a dividend yield of 10.5%. Hexindai pays out 250.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Nondepository credit institutions” companies pay a dividend yield of 2.2% and pay out 30.5% of their earnings in the form of a dividend.

Institutional and Insider Ownership

4.1% of Hexindai shares are owned by institutional investors. Comparatively, 51.0% of shares of all “Nondepository credit institutions” companies are owned by institutional investors. 16.0% of shares of all “Nondepository credit institutions” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Hexindai and its peers, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Hexindai 0 0 0 0 N/A
Hexindai Competitors 251 958 1144 61 2.42

As a group, “Nondepository credit institutions” companies have a potential upside of 34.29%. Given Hexindai’s peers higher probable upside, analysts plainly believe Hexindai has less favorable growth aspects than its peers.

Volatility & Risk

Hexindai has a beta of 1.19, suggesting that its share price is 19% more volatile than the S&P 500. Comparatively, Hexindai’s peers have a beta of 1.63, suggesting that their average share price is 63% more volatile than the S&P 500.

Profitability

This table compares Hexindai and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Hexindai 9.02% 4.10% 3.40%
Hexindai Competitors -73.28% -44.00% -1.29%

Earnings & Valuation

This table compares Hexindai and its peers top-line revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Hexindai $61.33 million $5.53 million 23.80
Hexindai Competitors $37.00 billion $864.41 million 10.18

Hexindai’s peers have higher revenue and earnings than Hexindai. Hexindai is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Summary

Hexindai peers beat Hexindai on 7 of the 12 factors compared.

Hexindai Company Profile

Hexindai Inc. operates a consumer lending marketplace that facilitates loans in China. It primarily focuses on facilitating medium-sized credit loans. The company provides borrowers a range of products based on customer segmentation data and tailored to the specific needs of the emerging middle class; and investors various types of investment products. The company was founded in 2013 and is headquartered in Beijing, China.

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