Financial Analysis: Atlantic International (NASDAQ:CIRC) & Medallion Financial (NASDAQ:MFIN)

Medallion Financial (NASDAQ:MFIN) and Atlantic International (NASDAQ:CIRC) are both small-cap finance companies, but which is the better business? We will compare the two businesses based on the strength of their dividends, profitability, valuation, analyst recommendations, institutional ownership, earnings and risk.

Institutional & Insider Ownership

40.6% of Medallion Financial shares are owned by institutional investors. 24.6% of Medallion Financial shares are owned by company insiders. Comparatively, 13.6% of Atlantic International shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Medallion Financial and Atlantic International”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Medallion Financial	$233.80 million	1.18	$43.04 million	$1.33	9.03
Atlantic International	$435.88 million	0.12	-$59.43 million	($2.11)	-0.26

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

Analyst Recommendations

This is a breakdown of current recommendations for Medallion Financial and Atlantic International, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Medallion Financial	0	4	0	0	2.00
Atlantic International	1	1	0	1	2.33

Medallion Financial currently has a consensus price target of $10.50, suggesting a potential downside of 12.53%. Given Medallion Financial’s higher probable upside, research analysts plainly believe Medallion Financial is more favorable than Atlantic International.

Profitability

This table compares Medallion Financial and Atlantic International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Medallion Financial	9.25%	7.11%	1.20%
Atlantic International	-19.39%	N/A	-28.58%

Risk and Volatility

Medallion Financial has a beta of 0.81, indicating that its share price is 19% less volatile than the S&P 500. Comparatively, Atlantic International has a beta of 0.81, indicating that its share price is 19% less volatile than the S&P 500.

Summary

Medallion Financial beats Atlantic International on 10 of the 13 factors compared between the two stocks.

About Medallion Financial

Medallion Financial Corp., together with its subsidiaries, operates as a specialty finance company in the United States. It operates in four segments: Recreation Lending, Home Improvement Lending, Commercial Lending, and Taxi Medallion Lending. The company offers loans that finance consumer purchases of recreational vehicles, boats, and other consumer recreational equipment; consumer financing for window, siding, and roof replacement, swimming pool installations, and other home improvement projects; senior and subordinated loans for the purchase of equipment and related assets necessary to open a new business, or purchase or improvement of an existing business; and taxi medallion loans to individuals and small to mid-size businesses. It also provides debt, mezzanine, and equity investment capital to companies in various commercial industries; and raises deposits and conducts other banking activities. Medallion Financial Corp. was incorporated in 1995 and is headquartered in New York City, New York.

About Atlantic International

Atlantic International Corp., through its subsidiaries, operates as a staffing company servicing the commercial, professional, finance, direct placement, and managed service provider verticals. The company specializes in permanent, temporary, and temporary-to-permanent placement services in various areas, including accounting and finance, administrative and clerical, hospitality, information technology, legal, light industrial, and medical fields. It also provides productivity consulting and workforce management solutions. Atlantic International Corp. was founded in 2018 and is based in Englewood Cliffs, New Jersey.