Contrasting Lufax (NYSE:LU) and SLM (NASDAQ:SLM)

SLM (NASDAQ:SLM) and Lufax (NYSE:LU) are both finance companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, earnings, profitability, dividends, analyst recommendations, risk and institutional ownership.

Earnings & Valuation

This table compares SLM and Lufax”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SLM	$2.63 billion	1.89	$744.85 million	$3.58	7.39
Lufax	$3.77 billion	0.32	-$291.79 million	($0.78)	-1.80

SLM has higher earnings, but lower revenue than Lufax. Lufax is trading at a lower price-to-earnings ratio than SLM, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

SLM has a beta of 0.96, suggesting that its share price is 4% less volatile than the S&P 500. Comparatively, Lufax has a beta of 0.81, suggesting that its share price is 19% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and recommmendations for SLM and Lufax, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SLM	1	6	5	0	2.33
Lufax	2	0	1	0	1.67

SLM presently has a consensus price target of $29.80, indicating a potential upside of 12.62%. Lufax has a consensus price target of $2.00, indicating a potential upside of 42.35%. Given Lufax’s higher probable upside, analysts plainly believe Lufax is more favorable than SLM.

Profitability

This table compares SLM and Lufax’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SLM	26.09%	33.81%	2.51%
Lufax	N/A	N/A	N/A

Institutional and Insider Ownership

98.9% of SLM shares are owned by institutional investors. Comparatively, 69.1% of Lufax shares are owned by institutional investors. 1.4% of SLM shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Summary

SLM beats Lufax on 12 of the 14 factors compared between the two stocks.

About SLM

SLM Corporation, through its subsidiaries, originates and services private education loans to students and their families to finance the cost of their education in the United States. It is also involved in the provision of retail deposit accounts, including certificates of deposit, money market accounts, and high-yield savings accounts; and interest-bearing omnibus accounts. The company was formerly known as New BLC Corporation and changed its name to SLM Corporation in December 2013. SLM Corporation was founded in 1972 and is headquartered in Newark, Delaware.

About Lufax

Lufax Holding Ltd operates as a financial service empowering institution for small and micro businesses in China. The company offers loan products, including general unsecured loans and secured loans, as well as consumer finance loans. It also provides wealth management products, such as asset management plans, mutual fund products, private investment fund products, and trust products. The company was founded in 2005 and is headquartered in Shanghai, China.