Head to Head Review: Bread Financial (NYSE:BFH) & Lufax (NYSE:LU)

Bread Financial (NYSE:BFH) and Lufax (NYSE:LU) are both mid-cap finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, profitability, risk, analyst recommendations, valuation, institutional ownership and dividends.

Earnings and Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Bread Financial	$3.80 billion	0.75	$277.00 million	$9.82	6.38
Lufax	$4.82 billion	0.51	$125.31 million	($0.77)	-3.69

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Bread Financial	10.08%	15.97%	2.27%
Lufax	N/A	N/A	N/A

Volatility and Risk

Bread Financial has a beta of 1.41, meaning that its share price is 41% more volatile than the S&P 500. Comparatively, Lufax has a beta of 0.75, meaning that its share price is 25% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings for Bread Financial and Lufax, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Bread Financial	3	8	3	1	2.13
Lufax	2	0	0	0	1.00

Bread Financial presently has a consensus price target of $70.00, indicating a potential upside of 11.73%. Given Bread Financial’s stronger consensus rating and higher possible upside, analysts clearly believe Bread Financial is more favorable than Lufax.

Institutional and Insider Ownership

99.5% of Bread Financial shares are owned by institutional investors. Comparatively, 69.1% of Lufax shares are owned by institutional investors. 0.9% of Bread Financial shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Summary

Bread Financial beats Lufax on 14 of the 15 factors compared between the two stocks.

About Bread Financial

Bread Financial Holdings, Inc. provides tech-forward payment and lending solutions to customers and consumer-based industries in North America. It offers credit card and other loans financing services, including risk management solutions, account origination, and funding services for private label and co-brand credit card programs, as well as through Bread partnerships; and Comenity-branded general purpose cash-back credit. The company also manages and services the loans it originates for private label, co-brand, and general-purpose credit card programs, and installment loans and split-pay products; and provides marketing, and data and analytics services. In addition, it offers an enhanced digital suite that includes a unified software development kit, which provides access to its suite of products, as well as promotes credit payment options earlier in the shopping experience. Further, the company through Bread, a digital payments platform and robust suite of application programming interfaces allows merchants and partners to integrate online point-of-sale financing and other digital payment products. It offers its products under the Bread CashbackTM, Bread PayTM, and Bread SavingsTM brands. The company was formerly known as Alliance Data Systems Corporation and changed its name to Bread Financial Holdings, Inc. in March 2022. Bread Financial Holdings, Inc. was incorporated in 1995 and is headquartered in Columbus, Ohio.

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.