Reviewing Home Point Capital (NASDAQ:HMPT) and Ocwen Financial (NYSE:OCN)

Home Point Capital (NASDAQ:HMPT) and Ocwen Financial (NYSE:OCN) are both small-cap construction companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, valuation, analyst recommendations, profitability, earnings, dividends and risk.

Insider & Institutional Ownership

95.7% of Home Point Capital shares are held by institutional investors. Comparatively, 49.3% of Ocwen Financial shares are held by institutional investors. 2.8% of Ocwen Financial shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Home Point Capital and Ocwen Financial’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Home Point Capital $1.38 billion 0.66 $607.00 million $4.86 1.34
Ocwen Financial $960.91 million 0.30 -$40.18 million N/A N/A

Home Point Capital has higher revenue and earnings than Ocwen Financial.

Analyst Recommendations

This is a summary of current ratings for Home Point Capital and Ocwen Financial, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Home Point Capital 1 4 5 0 2.40
Ocwen Financial 0 0 0 0 N/A

Home Point Capital currently has a consensus price target of $12.30, suggesting a potential upside of 88.65%. Given Home Point Capital’s higher probable upside, equities research analysts clearly believe Home Point Capital is more favorable than Ocwen Financial.

Profitability

This table compares Home Point Capital and Ocwen Financial’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Home Point Capital N/A N/A N/A
Ocwen Financial -0.67% -1.43% -0.06%

Summary

Home Point Capital beats Ocwen Financial on 10 of the 11 factors compared between the two stocks.

About Home Point Capital

Home Point Capital Inc., together with its subsidiaries, operates as a residential mortgage originator and service provider. It operates through two segments, Origination and Servicing. The Origination segment sources loans through direct, wholesale, and correspondent channels. The Servicing segment offers collecting loan payments; remitting principal and interest payments to investors; managing escrow funds for the payment of mortgage-related expenses, such as taxes and insurance; and performing loss mitigation activities on behalf of investors and administering mortgage loans. The company was incorporated in 2014 and headquartered in Ann Arbor, Michigan.

About Ocwen Financial

Ocwen Financial Corporation, a financial services company, originates and services mortgage loans in the United States, the United States Virgin Islands, India, and the Philippines. The company operates through Servicing and Originations segments. It provides commercial mortgage loan servicing, special servicing, and asset management services, as well as residential mortgage loan servicing, such as forward and reverse conventional, government-insured, and non-agency loans, including the reverse mortgage loans to owners of mortgage loans and foreclosed real estate. The company also originates and purchases conventional and government-insured residential forward and reverse mortgage loans through its correspondent lending arrangements, broker relationships, and retail channels. Ocwen Financial Corporation serves primarily under the PHH Mortgage and Liberty Reverse Mortgage brands. The company was founded in 1988 and is headquartered in West Palm Beach, Florida.

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