Top 20 Financial Services Stocks, Ranked by Marvin Scores
Marvin's rules pick 20 financial services stocks across five industries. Gold.com, Jefferson Capital and Virtu Financial lead on Overall score, which compares each company with its industry peers.
Financial services covers many kinds of businesses: trading firms, exchanges, lenders, mortgage companies and investment banks. This list pulls 20 companies from five related industries, so the stocks differ a lot in how they earn money and what their numbers look like.
The list is ordered by Marvin's Overall score, which compares each company with others in its own industry. A high score means a company looks strong next to its direct peers today. It does not mean the stock is a good deal, and it does not say anything about future results.
When you read the picks, look at the figures behind the scores: growth, margins, return on equity and debt. Some companies are missing figures, and a few have weak numbers. Each blurb notes these gaps and weak spots so you can see where more research is needed.
The list
How Marvin ranked these stocks
Marvin included companies above about $300 million in size and ranked them by Marvin scores, which run from zero to one hundred and are relative to each company's own industry. The list draws on five related industries (Financial - Capital Markets, Financial - Conglomerates, Financial - Credit Services, Financial - Data & Stock Exchanges and Financial - Mortgages), puts the highest Overall score first, and allows at most four companies per industry. Because scores compare a company only with its industry peers, a score in one industry is not a like-for-like match for the same score in another.
Companies above about $300 million in size, ranked by Marvin scores (0-100, relative to each company's own industry). The 5 related industries in this group (Financial - Capital Markets, Financial - Conglomerates, Financial - Credit Services, Financial - Data & Stock Exchanges, Financial - Mortgages), highest Overall score first; at most 4 per industry.
The stocks, one by one
Gold.com, Inc. GOLD
Gold.com tops this list with an overall score of 97 and an opportunity score of 97. Revenue growth last fiscal year was 132.4%. The caution is a gross margin of only 1.8%, which leaves little profit per dollar of sales. Return on equity is 9.4%, a moderate level.
Jefferson Capital, Inc. Common Stock JCAP
Jefferson Capital has an overall score of 96 and a quality score of 69. Revenue grew 41.5%, operating margin is a strong 45.8%, and return on equity is 32.6%. The caution is that debt and free cash flow figures are missing, so its balance sheet can't be judged here.
Virtu Financial, Inc. VIRT
Virtu Financial combines a quality score of 84 with return on equity of 29.5%, a high level, and revenue growth of 26.2%. Debt-to-equity is 1.23, a moderate amount of borrowing. The caution is that no operating margin is available, so profitability on sales is unclear.
CME Group Inc. CME
CME Group has a quality score of 93, backed by an operating margin of 65.1% and a free cash flow margin of 62.2%. Those are very high margins. Revenue growth is a modest 6.4%, and the opportunity score of 69 is the weaker part of its profile.
Velocity Financial, Inc. VEL
Velocity Financial has an overall score of 86, with a quality score of 65 and an opportunity score of 94. Return on equity is 14.9%, a reasonable level. The caution is that growth, margin and debt figures are all missing, so the picture is incomplete.
Encore Capital Group, Inc. ECPG
Encore Capital Group has a quality score of 89, one of the higher ones here. Revenue grew 34.4%, operating margin is 37.7% and return on equity is 28.0%, all solid. The caution is that debt-to-equity isn't available, so leverage can't be checked.
Evercore Inc. EVR
Evercore has a quality score of 90 and a return on equity of 40.1%, a high level. Revenue grew 29.4%. Its operating margin of 21.4% is more modest than the exchange companies on this list, and its opportunity score of 86 trails its quality score.
PennyMac Financial Services, Inc. PFSI
PennyMac Financial Services has an opportunity score of 96 but a quality score of just 61. Revenue grew 28.4% and operating margin is 22.9%. The cautions are a low return on equity of 9.0% and debt-to-equity of 1.48, which is on the higher side.
Atlanticus Holdings Corporation ATLC
Atlanticus Holdings grew revenue 50.1% and has a gross margin of 92.6%. Return on equity is 21.9%, a healthy level. The caution is a thin operating margin of 7.7%, which means little of each sales dollar remains as operating profit.
Morgan Stanley MS
Morgan Stanley has a quality score of 88, an operating margin of 33.5% and return on equity of 17.3%. Revenue grew 14.4%. The caution is debt: its debt-to-equity ratio of 3.29 is higher than most companies on this list that report it.
Capital One Financial Corporation COF
Capital One Financial has quality and opportunity scores of 85 and 85. Revenue grew 36.6%, operating margin is 21.0%, and debt-to-equity is a low 0.40. The caution is a return on equity of 9.2%, which is modest next to many peers here.
Intercontinental Exchange, Inc. ICE
Intercontinental Exchange has a strong operating margin of 40.7% and a free cash flow margin of 37.8%. Debt-to-equity is 0.78. The cautions are slow revenue growth of 7.5% and a middling quality score of 55.
Nasdaq, Inc. NDAQ
Nasdaq has an operating margin of 29.6%, a free cash flow margin of 22.3% and a gross margin of 64.3%, with debt-to-equity of 0.78. Revenue growth is 11.6%. The caution is a quality score of only 63, lower than most higher-ranked names here.
Moody's Corporation MCO
Moody's has a quality score of 86, an operating margin of 44.8% and a very high return on equity of 92.4%. Revenue grew 8.9%. The cautions are a low opportunity score of 23 and debt-to-equity of 2.49, which is on the higher side.
Morgan Stanley Direct Lending Fund MSDL
Morgan Stanley Direct Lending Fund has an operating margin of 45.0%, which is high, and debt-to-equity of 1.20. The cautions are that revenue shrank, with growth of -4.5%, and return on equity is only 3.6%, a weak return on shareholders' money.
UWM Holdings Corporation UWMC
UWM Holdings has an opportunity score of 86 and revenue growth of 18.2%. The cautions are significant: operating margin is -3.2% and return on equity is -3.8%, so it was not profitable by those measures. Debt-to-equity is also 3.15.
Drugs Made In America Acquisition II Corp. Ordinary Shares DMII
Drugs Made In America Acquisition II Corp. has an overall score of 51, a quality score of 41 and an opportunity score of 84. The caution is that no growth, margin, return or debt figures are available, so there is little to judge beyond the scores.
Walker & Dunlop, Inc. WD
Walker & Dunlop grew revenue 9.0%, but its profitability is low, with an operating margin of 4.3% and return on equity of 2.3%. The caution is its opportunity score of 16, one of the lowest here, and its overall score of 39.
Freedom Holding Corp. FRHC
Freedom Holding Corp. has a gross margin of 95.8%, but its operating margin is only 9.1%. Revenue grew 9.3% and return on equity is 9.6%. The caution is a low overall score of 30 and an opportunity score of 8.
Evernorth Holdings, Inc. Class A XRPN
Evernorth Holdings has the lowest overall score on the list at 4, with a quality score of 8 and an opportunity score of 18. The caution is that no growth, margin, return or debt figures are available, so the scores can't be checked against financial results.
Common questions
What do Marvin's Overall, Quality and Opportunity scores mean?
They are scores from zero to one hundred that compare a company with other companies in its own industry today. They describe relative standing only. They are not a recommendation and not a forecast.
Why does this list mix exchanges, lenders and mortgage companies?
Marvin groups five related financial industries into one financial services list and allows at most four companies from each. These businesses earn money in different ways, so their margins and debt levels are not directly comparable. Scores are relative to each company's own industry for that reason.
Why are some figures missing for certain stocks?
Marvin only shows a figure when it is available for that company. Banks and lenders often report debt and cash flow differently from other businesses, so some measures, such as free cash flow margin or debt-to-equity, may be absent. Where figures are missing, treat the picture as incomplete and check the company's own financial reports.
Keep reading
- Top 15 Financial Services Stocks by Marvin's Opportunity Score
- Top 15 Credit Services Financial Stocks
- Top 15 Capital Markets Financial Stocks
- Top 15 Financial Services Stocks Right Now
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Marvin's scores (0-100) compare each company with others in its industry today. Growth and margin figures come from SEC filings. This is general information, not personal investment advice or a recommendation to buy or sell anything. Do your own research.