Northland Securities Remains a Buy on OneMain Holdings Inc (OMF)


Northland Securities analyst Michael Grondahl maintained a Buy rating on OneMain Holdings Inc (OMF) today and set a price target of $50. The company’s shares closed last Monday at $38.04.

Grondahl noted:

“We reiterate our OP rating and $50 PT. California AB 539 titled Act could change the consumer lending landscape in CA. The bill would place an annual interest rate cap of 36% + Federal Funds for CFL (California Financing Law) licenses on consumer loans ranging from $2,500-$10,000. Know OMF loans already have an interest rate cap of 36%, so they would not be directly affected, but many industry players would have their higher rate products reduced and possibly exit the consumer lending business. The Bill passed last Friday and is headed to the Governors desk. Industry sources noted roughly $1.2B of consumer loans would be up for grabs. If OMF could get $250M of these loans, that’s a roughly 2% lift in the loan book.”

According to TipRanks.com, Grondahl is a 5-star analyst with an average return of 15.4% and a 56.4% success rate. Grondahl covers the Financial sector, focusing on stocks such as Front Yard Residential Corporation, Altisource Portfolio Solutions SA, and Health Insurance Innovations.

The word on The Street in general, suggests a Strong Buy analyst consensus rating for OneMain Holdings Inc with a $47.67 average price target.

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Based on OneMain Holdings Inc’s latest earnings release for the quarter ending June 30, the company reported a quarterly revenue of $1.17 billion and net profit of $194 million. In comparison, last year the company earned revenue of $1.05 billion and had a net profit of $7 million.

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OneMain Holdings, Inc. is a consumer finance company, which provides origination, underwriting and servicing of personal loans, primarily to non-prime customers. It operates through the following two segments: Consumer & Insurance and Acquisitions & Servicing, The Consumer & Insurance segment is comprised of service secured and unsecured personal loans and voluntary credit and non-credit insurance and related products through its combined branch network, digital platform, and centralized operations. The Acquisition & Services segment engages in providing services SpringCastle portfolio which was acquired through joint venture. The company was founded on August 5, 2013 and is headquartered in Evansville, IN.

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