Pagaya Technologies (NASDAQ:PGY – Get Free Report) and NU (NYSE:NU – Get Free Report) are both finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their profitability, institutional ownership, earnings, risk, dividends, valuation and analyst recommendations.
Earnings & Valuation
This table compares Pagaya Technologies and NU”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Pagaya Technologies | $939.31 million | 0.70 | -$128.44 million | ($2.54) | -3.52 |
| NU | $7.85 billion | 6.30 | $1.03 billion | $0.36 | 28.83 |
NU has higher revenue and earnings than Pagaya Technologies. Pagaya Technologies is trading at a lower price-to-earnings ratio than NU, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Pagaya Technologies | 0 | 3 | 6 | 0 | 2.67 |
| NU | 1 | 4 | 5 | 0 | 2.40 |
Pagaya Technologies currently has a consensus price target of $20.00, indicating a potential upside of 123.46%. NU has a consensus price target of $15.63, indicating a potential upside of 50.61%. Given Pagaya Technologies’ stronger consensus rating and higher probable upside, equities research analysts plainly believe Pagaya Technologies is more favorable than NU.
Profitability
This table compares Pagaya Technologies and NU’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Pagaya Technologies | -18.48% | 1.01% | 0.47% |
| NU | 16.28% | 28.70% | 4.41% |
Institutional & Insider Ownership
57.1% of Pagaya Technologies shares are held by institutional investors. Comparatively, 84.0% of NU shares are held by institutional investors. 49.6% of Pagaya Technologies shares are held by insiders. Comparatively, 1.2% of NU shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Volatility and Risk
Pagaya Technologies has a beta of 6.11, indicating that its share price is 511% more volatile than the S&P 500. Comparatively, NU has a beta of 0.99, indicating that its share price is 1% less volatile than the S&P 500.
Summary
NU beats Pagaya Technologies on 9 of the 14 factors compared between the two stocks.
About Pagaya Technologies
Pagaya Technologies Ltd., a product-focused technology company, deploys data science and proprietary artificial intelligence-powered technology for financial institutions and investors in the United States, Israel, the Cayman Islands, and internationally. The company develops and implements proprietary artificial intelligence technology and related software solutions to assist partners to originate loans and other assets. Its partners include high-growth financial technology companies, incumbent banks and financial institutions, auto finance providers, and residential real estate service providers. Pagaya Technologies Ltd. was incorporated in 2016 and is headquartered in New York, New York.
About NU
Nu Holdings Ltd. provides digital banking platform and digital financial services in Brazil, Mexico, Colombia, and internationally. It offers Nu credit and debit cards; Ultraviolet credit and debit cards; and mobile payment solutions for NuAccount customers to make and receive transfers, pay bills, and make everyday purchases through their mobile phones. The company provides savings solutions, such as Nu Personal Accounts, a digital account solution that supports all personal finance activities, from daily purchases and money transfers to savings; and Nu business accounts designed specifically for entrepreneur customers and their businesses. In addition, it offers NuCrypto, a solution for buying and selling cryptocurrencies through the Nu app; NuInvest, an investment product that provides equity, fixed-income, options, and ETF products, as well as multimarket funds with curated asset allocations based on the customer's risk profile and financial position; personal unsecured loans; in-app buy now pay later' solution for Nu card customers to pay credit and debit purchases, and banking payment slips over time in up to twelve installments; and NuInsurance protecting solutions to help its customers secure life insurance and funeral benefits. The company was founded in 2013 and is headquartered in Sao Paulo, Brazil.
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