Critical Review: Performant Financial Corporation (PFMT) and The Competition

Performant Financial Corporation (NASDAQ: PFMT) is one of 98 publicly-traded companies in the “Business Support Services” industry, but how does it contrast to its rivals? We will compare Performant Financial Corporation to related companies based on the strength of its dividends, institutional ownership, valuation, profitability, risk, analyst recommendations and earnings.

Earnings & Valuation

This table compares Performant Financial Corporation and its rivals top-line revenue, earnings per share and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Performant Financial Corporation $134.02 million $6.52 million -5.19
Performant Financial Corporation Competitors $1.11 billion $178.14 million 21.28

Performant Financial Corporation’s rivals have higher revenue and earnings than Performant Financial Corporation. Performant Financial Corporation is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Volatility and Risk

Performant Financial Corporation has a beta of 1.09, indicating that its share price is 9% more volatile than the S&P 500. Comparatively, Performant Financial Corporation’s rivals have a beta of 1.12, indicating that their average share price is 12% more volatile than the S&P 500.

Insider & Institutional Ownership

54.7% of Performant Financial Corporation shares are owned by institutional investors. Comparatively, 63.0% of shares of all “Business Support Services” companies are owned by institutional investors. 33.6% of Performant Financial Corporation shares are owned by insiders. Comparatively, 11.9% of shares of all “Business Support Services” companies are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Performant Financial Corporation and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Performant Financial Corporation -13.74% -6.81% -3.17%
Performant Financial Corporation Competitors -129.10% -181.16% -5.94%

Analyst Ratings

This is a summary of recent ratings and recommmendations for Performant Financial Corporation and its rivals, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Performant Financial Corporation 0 1 0 0 2.00
Performant Financial Corporation Competitors 735 2086 2674 84 2.38

As a group, “Business Support Services” companies have a potential downside of 1.87%. Given Performant Financial Corporation’s rivals stronger consensus rating and higher possible upside, analysts plainly believe Performant Financial Corporation has less favorable growth aspects than its rivals.

Summary

Performant Financial Corporation rivals beat Performant Financial Corporation on 8 of the 12 factors compared.

Performant Financial Corporation Company Profile

Performant Financial Corporation (Performant) provides technology-enabled recovery and related analytics services in the United States. The Company’s services identify and recover delinquent or defaulted assets and improper payments for both government and private clients in a range of markets. The Company provides its services on an outsourced basis where the Company handles many or all aspects of its clients’ recovery processes. The Company uses its technology-enabled services platform to provide recovery and analytics services in a range of markets for the identification and recovery of student loans, improper healthcare payments and delinquent state tax and federal treasury receivables. It provides recovery services to the government-supported student loan industry and its clients include the Department of Education and Guaranty Agencies, as well as private financial institutions. The Company provides recovery services related to improper payments in the healthcare market.

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