Comparing Lufax (NYSE:LU) & LexinFintech (NASDAQ:LX)

LexinFintech (NASDAQ:LX) and Lufax (NYSE:LU) are both small-cap finance companies, but which is the superior business? We will compare the two companies based on the strength of their analyst recommendations, profitability, risk, valuation, earnings, institutional ownership and dividends.

Risk and Volatility

LexinFintech has a beta of 0.94, suggesting that its stock price is 6% less volatile than the S&P 500. Comparatively, Lufax has a beta of 0.8, suggesting that its stock price is 20% less volatile than the S&P 500.

Earnings and Valuation

This table compares LexinFintech and Lufax”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
LexinFintech	$12.96 billion	0.01	$239.82 million	$0.84	0.73
Lufax	$3.77 billion	0.17	-$291.79 million	($6.10)	-1.18

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

Analyst Recommendations

This is a breakdown of current ratings and price targets for LexinFintech and Lufax, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
LexinFintech	1	2	0	0	1.67
Lufax	1	2	1	0	2.00

LexinFintech currently has a consensus target price of $2.35, suggesting a potential upside of 282.30%. Lufax has a consensus target price of $17.00, suggesting a potential upside of 136.01%. Given LexinFintech’s higher possible upside, analysts clearly believe LexinFintech is more favorable than Lufax.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
LexinFintech	7.94%	8.59%	4.50%
Lufax	N/A	N/A	N/A

Insider & Institutional Ownership

69.1% of Lufax shares are owned by institutional investors. 27.8% of LexinFintech shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

LexinFintech beats Lufax on 10 of the 14 factors compared between the two stocks.

About LexinFintech

LexinFintech Holdings Ltd. (NASDAQ: LX) is a China-based fintech company that provides technology-enabled consumer finance services. The company focuses on helping young and emerging consumers access installment payment and credit products through digital platforms. Lexin operates Fenqile, an online consumer platform that offers installment purchasing and related financial services. Its business also includes facilitating consumer loans and providing technology, risk-management, and related services to support credit origination and repayment.

About Lufax

Lufax Holding Ltd. is a China-based financial technology company that provides technology-enabled financial services. Its platform connects individual and small-business borrowers with financial institutions and other funding partners, helping customers access credit and related services. The company also offers wealth management services, including access to investment products for retail customers. Lufax was established in 2011 as part of Ping An Insurance Group and has developed its business around China’s financial services market.