Reviewing CNFinance (NYSE:CNF) and Usio (NASDAQ:USIO)

CNFinance (NYSE:CNF) and Usio (NASDAQ:USIO) are both small-cap finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, earnings, analyst recommendations, valuation, profitability, dividends and institutional ownership.

Profitability

This table compares CNFinance and Usio’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CNFinance	N/A	N/A	N/A
Usio	-1.63%	-8.20%	-1.26%

Analyst Ratings

This is a summary of current ratings for CNFinance and Usio, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CNFinance	1	0	0	0	1.00
Usio	0	2	2	0	2.50

Usio has a consensus price target of $5.38, suggesting a potential upside of 72.83%. Given Usio’s stronger consensus rating and higher possible upside, analysts clearly believe Usio is more favorable than CNFinance.

Institutional and Insider Ownership

20.2% of Usio shares are held by institutional investors. 25.8% of CNFinance shares are held by company insiders. Comparatively, 19.0% of Usio shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares CNFinance and Usio”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CNFinance	$80.76 million	0.16	-$65.43 million	$1.40	1.30
Usio	$85.39 million	1.04	-$2.51 million	($0.06)	-51.83

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

Risk & Volatility

CNFinance has a beta of 0.17, suggesting that its stock price is 83% less volatile than the S&P 500. Comparatively, Usio has a beta of 1.36, suggesting that its stock price is 36% more volatile than the S&P 500.

Summary

Usio beats CNFinance on 8 of the 14 factors compared between the two stocks.

About CNFinance

CNFinance Holdings Limited, through its subsidiaries, provides home equity loan services in the People's Republic of China. It offers micro credit loan services for micro and small-enterprise owners; and loan lending agency services for financial institutions. The company provides bridge loan products, which are unsecured short-term loans to pay off borrowers' existing loans secured by real property. It operates approximately 87 branches and sub-branches in China. The company was founded in 1999 and is headquartered in Guangzhou, the People's Republic of China.

About Usio

Usio, Inc., together with its subsidiaries, provides integrated electronic payment processing services to merchants and businesses in the United States. The company offers various types of automated clearing house (ACH) processing; and credit, prepaid card, and debit card-based processing services. Its ACH transaction processing services include Represented Check and Check Conversion for electronic payment facilitation. In addition, the company offers merchant account services for the processing of card-based transactions through the VISA, MasterCard, American Express, Discover, and JCB networks, including online terminal services accessed through a website or retail services accessed through a physical terminal. Further, it provides a proprietary web-based customer service application that allows companies to process one-time and recurring payments through e-checks or credit cards; and an interactive voice response telephone system to companies, which accept payments directly from consumers over the telephone using e-checks or credit cards. Additionally, the company offers prepaid and incentive card issuance services; and operates a prepaid core processing platform, as well as provides additional services, such as electronic bill presentment, document composition, document decomposition, and printing and mailing services for various industry verticals, including utilities and financial institutions. It markets and sells ACH products and services primarily through resellers; and prepaid card program directly to government entities, corporations, and to consumers through the internet. The company was formerly known as Payment Data Systems, Inc. and changed its name to Usio, Inc. in June 2019. Usio, Inc. was incorporated in 1998 and is headquartered in San Antonio, Texas.