NU (NYSE:NU – Get Free Report) and Walker & Dunlop (NYSE:WD – Get Free Report) are both business services companies, but which is the better business? We will compare the two companies based on the strength of their institutional ownership, profitability, analyst recommendations, valuation, earnings, risk and dividends.
Institutional & Insider Ownership
80.9% of NU shares are owned by institutional investors. Comparatively, 81.0% of Walker & Dunlop shares are owned by institutional investors. 1.2% of NU shares are owned by company insiders. Comparatively, 5.5% of Walker & Dunlop 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.
Profitability
This table compares NU and Walker & Dunlop’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| NU | 15.11% | 27.00% | 4.19% |
| Walker & Dunlop | 8.91% | 9.81% | 4.11% |
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| NU | 0 | 3 | 5 | 0 | 2.63 |
| Walker & Dunlop | 0 | 2 | 0 | 1 | 2.67 |
NU currently has a consensus price target of $15.21, indicating a potential downside of 3.78%. Walker & Dunlop has a consensus price target of $111.00, indicating a potential upside of 0.40%. Given Walker & Dunlop’s stronger consensus rating and higher possible upside, analysts clearly believe Walker & Dunlop is more favorable than NU.
Risk and Volatility
NU has a beta of 1.13, indicating that its share price is 13% more volatile than the S&P 500. Comparatively, Walker & Dunlop has a beta of 1.55, indicating that its share price is 55% more volatile than the S&P 500.
Dividends
NU pays an annual dividend of $1.67 per share and has a dividend yield of 10.6%. Walker & Dunlop pays an annual dividend of $2.60 per share and has a dividend yield of 2.4%. NU pays out 538.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Walker & Dunlop pays out 92.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Earnings and Valuation
This table compares NU and Walker & Dunlop”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| NU | $7.25 billion | 10.39 | $1.03 billion | $0.31 | 51.00 |
| Walker & Dunlop | $1.07 billion | 3.50 | $107.36 million | $2.80 | 39.49 |
NU has higher revenue and earnings than Walker & Dunlop. Walker & Dunlop is trading at a lower price-to-earnings ratio than NU, indicating that it is currently the more affordable of the two stocks.
Summary
NU beats Walker & Dunlop on 9 of the 17 factors compared between the two stocks.
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.
About Walker & Dunlop
Walker & Dunlop, Inc., through its subsidiaries, originates, sells, and services a range of multifamily and other commercial real estate financing products and services for owners and developers of real estate in the United States. It operates through three segments: Capital Markets, Servicing & Asset Management, and Corporate. The company offers first mortgage, second trust, supplemental, construction, mezzanine, preferred equity, and small-balance loans. It also provides finance for multifamily, manufactured housing communities, student housing, affordable housing, and senior housing properties under the Fannie Mae's DUS program; and construction and permanent loans to developers and owners of multifamily housing, affordable housing, senior housing, and healthcare facilities. In addition, the company acts as a debt broker to work with life insurance companies, banks, and other institutional lenders to find debt and/or equity solution for the borrowers' needs; and offers property sales brokerage services to owners and developers of multifamily properties, and commercial real estate and multifamily property appraisals for various investors. Further, it provides multifamily appraisal and valuation services; and real estate-related investment banking and advisory services, including housing market research. Additionally, the company offers servicing and asset-managing the portfolio of loans; originates loans through its principal lending and investing activities; and manages third-party capital invested in tax credit equity funds focused on the LIHTC sector and other commercial real estate sectors. Walker & Dunlop, Inc. was founded in 1937 and is headquartered in Bethesda, Maryland.
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