Financial Survey: Lifelock (LOCK) vs. Performant Financial Corporation (PFMT)

Lifelock (NYSE: LOCK) and Performant Financial Corporation (NASDAQ:PFMT) are both industrials companies, but which is the better business? We will compare the two companies based on the strength of their risk, valuation, institutional ownership, earnings, analyst recommendations, dividends and profitability.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Lifelock	8.46%	24.53%	10.96%
Performant Financial Corporation	-13.74%	-6.81%	-3.17%

Analyst Recommendations

This is a summary of current ratings and target prices for Lifelock and Performant Financial Corporation, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lifelock	1	3	0	0	1.75
Performant Financial Corporation	0	1	0	0	2.00

Lifelock currently has a consensus price target of $24.00, suggesting a potential upside of 0.04%. Given Lifelock’s higher possible upside, analysts plainly believe Lifelock is more favorable than Performant Financial Corporation.

Risk & Volatility

Lifelock has a beta of 1.34, indicating that its share price is 34% more volatile than the S&P 500. Comparatively, Performant Financial Corporation has a beta of 1.07, indicating that its share price is 7% more volatile than the S&P 500.

Institutional & Insider Ownership

88.8% of Lifelock shares are owned by institutional investors. Comparatively, 54.8% of Performant Financial Corporation shares are owned by institutional investors. 13.9% of Lifelock shares are owned by company insiders. Comparatively, 33.6% of Performant Financial Corporation shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Lifelock and Performant Financial Corporation’s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	EBITDA	Earnings Per Share	Price/Earnings Ratio
Lifelock	N/A	N/A	N/A	$0.17	141.12
Performant Financial Corporation	$134.02 million	0.68	$6.52 million	($0.36)	-5.00

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

Summary

Lifelock beats Performant Financial Corporation on 7 of the 10 factors compared between the two stocks.

About Lifelock

LifeLock, Inc. provides proactive identity theft protection services for consumers and consumer risk management services for enterprises. The Company monitors certain identity-related events, such as new account openings and credit-related applications. It operates in two segments: consumer segment and an enterprise segment. The Company’s LifeLock ecosystem combines data repositories of personally identifiable information and consumer transactions, predictive analytics and a technology platform. It applies predictive analytics to the data in its repositories to provide its members and enterprise customers’ actionable intelligence that helps protect against identity theft and identity fraud. It offers its consumer services on a monthly or annual subscription basis. It provides consumer risk management services, including delivering its on-demand identity risk, identity-authentication and credit information about consumers to its enterprise customers in the daily transaction flows.

About Performant Financial Corporation

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.