Analyzing Runway Growth Finance (NASDAQ:RWAY) and Mr. Cooper Group (NASDAQ:COOP)

Mr. Cooper Group (NASDAQ:COOPGet Free Report) and Runway Growth Finance (NASDAQ:RWAYGet Free Report) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their dividends, earnings, analyst recommendations, institutional ownership, valuation, risk and profitability.

Insider & Institutional Ownership

80.5% of Mr. Cooper Group shares are held by institutional investors. 3.1% of Mr. Cooper Group shares are held by company insiders. Comparatively, 1.0% of Runway Growth Finance shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Mr. Cooper Group and Runway Growth Finance’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Mr. Cooper Group $2.46 billion 1.76 $923.00 million $6.66 9.87
Runway Growth Finance $108.55 million 4.91 $32.25 million $1.68 7.84

Mr. Cooper Group has higher revenue and earnings than Runway Growth Finance. Runway Growth Finance is trading at a lower price-to-earnings ratio than Mr. Cooper Group, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Mr. Cooper Group has a beta of 1.43, suggesting that its share price is 43% more volatile than the S&P 500. Comparatively, Runway Growth Finance has a beta of 0.72, suggesting that its share price is 28% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Mr. Cooper Group and Runway Growth Finance, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Mr. Cooper Group 0 0 8 0 3.00
Runway Growth Finance 0 2 2 0 2.50

Mr. Cooper Group currently has a consensus price target of $74.63, indicating a potential upside of 13.50%. Runway Growth Finance has a consensus price target of $13.35, indicating a potential upside of 1.37%. Given Mr. Cooper Group’s stronger consensus rating and higher possible upside, analysts clearly believe Mr. Cooper Group is more favorable than Runway Growth Finance.

Profitability

This table compares Mr. Cooper Group and Runway Growth Finance’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Mr. Cooper Group 26.88% 10.91% 3.45%
Runway Growth Finance 41.79% 13.68% 6.98%

Summary

Mr. Cooper Group beats Runway Growth Finance on 10 of the 14 factors compared between the two stocks.

About Mr. Cooper Group

(Get Free Report)

Mr. Cooper Group Inc. engages in non-banking services for mortgage loans the United States. The company operates through two segments: Servicing and Originations. The Servicing segment performs activities for underlying mortgages, including collecting and disbursing borrower payments, investor reporting, customer service, and modifying loans. The Originations segment originates residential mortgage loans through its direct-to-consumer channel, as well as originates and purchases loans from mortgage bankers. It operates primarily under the Mr. Cooper and Xome brands. The company was formerly known as WMIH Corp. and changed its name to Mr. Cooper Group Inc. in October 2018. Mr. Cooper Group Inc. was incorporated in 2015 and is based in Coppell, Texas.

About Runway Growth Finance

(Get Free Report)

Runway Growth Finance Corp. is a business development company specializing investments in senior-secured loans to late stage and growth companies. It prefers to make investments in companies engaged in the technology, life sciences, healthcare and information services, business services and select consumer services and products sectors. It prefers to investments in companies engaged in electronic equipment and instruments, systems software, hardware, storage and peripherals and specialized consumer services, application software, healthcare technology, internet software and services, data processing and outsourced services, internet retail, human resources and employment services, biotechnology, healthcare equipment and education services. It invests in senior secured loans between $10 million and $75 million.

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