Altisource Portfolio Solutions (NASDAQ: ASPS) and HFF (NYSE:HF) are both small-cap finance companies, but which is the better business? We will contrast the two companies based on the strength of their earnings, institutional ownership, profitability, dividends, analyst recommendations, risk and valuation.

Volatility & Risk

Altisource Portfolio Solutions has a beta of 0.76, indicating that its stock price is 24% less volatile than the S&P 500. Comparatively, HFF has a beta of 1.21, indicating that its stock price is 21% more volatile than the S&P 500.

Profitability

This table compares Altisource Portfolio Solutions and HFF’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Altisource Portfolio Solutions 0.60% 82.95% 8.76%
HFF 15.51% 40.20% 8.06%

Analyst Ratings

This is a summary of recent ratings and target prices for Altisource Portfolio Solutions and HFF, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Altisource Portfolio Solutions 0 2 0 0 2.00
HFF 1 2 1 0 2.00

Altisource Portfolio Solutions currently has a consensus price target of $19.00, indicating a potential downside of 21.26%. HFF has a consensus price target of $28.00, indicating a potential downside of 26.10%. Given Altisource Portfolio Solutions’ higher possible upside, equities research analysts clearly believe Altisource Portfolio Solutions is more favorable than HFF.

Earnings and Valuation

This table compares Altisource Portfolio Solutions and HFF’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Altisource Portfolio Solutions $982.54 million 0.44 $148.76 million $0.28 86.18
HFF $542.82 million 2.69 $84.87 million $2.20 17.22

Altisource Portfolio Solutions has higher revenue and earnings than HFF. HFF is trading at a lower price-to-earnings ratio than Altisource Portfolio Solutions, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

54.9% of Altisource Portfolio Solutions shares are owned by institutional investors. Comparatively, 87.1% of HFF shares are owned by institutional investors. 6.8% of Altisource Portfolio Solutions shares are owned by insiders. Comparatively, 5.7% of HFF shares are owned by 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

HFF beats Altisource Portfolio Solutions on 7 of the 13 factors compared between the two stocks.

About Altisource Portfolio Solutions

Altisource Portfolio Solutions S.A. is a marketplace and transaction solutions provider for the real estate, mortgage and consumer debt industries. The Company’s business processes, vendor and electronic payment management software and behavioral science-based analytics manage outcomes for marketplace participants. It operates through three segments: Mortgage Services, Financial Services and Technology Services. The Mortgage Services segment provides loan servicers, originators, rental property investors and real estate consumers with products, services and technologies. The Financial Services segment provides collection services to debt originators and servicers and customer relationship management services. The Technology Services segment provides software and data analytics solutions that support management of mortgage and real estate activities and marketplace transactions across mortgage and real estate lifecycles and information technology infrastructure management services.

About HFF

HFF, Inc. is a holding company. The Company holds the partnership interests in Holliday Fenoglio Fowler, L.P. and HFF Securities L.P. (together, the Operating Partnerships), held through the subsidiary HFF Partnership Holdings, LLC, and all of the outstanding shares of Holliday GP Corp. (Holliday GP). The Company operates through the commercial real estate financial intermediary segment. It offers debt placement, investment sales, distressed debt and real estate owned advisory services, equity placement, investment banking and advisory services, loan sales and commercial loan servicing. Its fully-integrated national capital markets platform, coupled with its knowledge of the commercial real estate markets provides an range of capital markets services, including Debt placement; Investment sales; Distressed debt and real estate owned advisory services; Equity placement; Investment banking and advisory services; Loan sales; and Commercial loan servicing.

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