OneMain Holdings (OMF) AI Stock Analysis

• Market Cap: $5.15B
• Dividend Yield: 9.37%
• Average Volume (3M): 1.50M
• Price to Earnings (P/E): 10.2
• Beta (1Y): 1.41
• Revenue Growth: 7.96%
• EPS Growth: -20.11%
• Country: US
• Employees: 9,000
• Sector: Financial
• Sector Strength: 78
• Industry: Financial - Credit Services
• EPS (TTM): 1.16
• Shares Outstanding: 119,368,020
• 10 Day Avg. Volume: 1,841,053
• 30 Day Avg. Volume: 1,499,994
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 2.44
• Price to Cash Flow (P/CF): 2.00
• P/FCF Ratio: 1.50
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $57.40
• Price Target Upside: 31.50% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 11

OneMain Holdings scores moderately due to strong revenue growth and robust cash flow conversion but faces challenges from declining net profit margins and high leverage. Technical indicators suggest a bearish trend, while valuation metrics show the stock is attractively priced. The earnings call balanced positive growth outlooks with concerns over decreased net income. The recent board appointment adds a positive strategic outlook.

Positive Factors

Credit Trends

The significant improvement in credit trends is in response to the company’s tightened underwriting, and not to any identifiable macro development.

Market Share

OMF commands a 20% market share of the $110B non-prime personal loan market.

Profitability and Growth

OMF’s solid profitability, favorable long-term growth, and impressive management team are expected to support the stock’s valuation over time.

Negative Factors

Earnings Estimates

The EPS estimate is still below consensus EPS of $1.57.

Growth Outlook

Shares of OMF traded down 3% following the release of 4Q24 results and guidance, likely in response to a slower 2025 portfolio growth outlook versus consensus.

Market Position

OMF is added to the Evercore ISI Tactical Underperform List as recalibration of Street estimates could pressure the shares near term.

OneMain Holdings Business Overview & Revenue Model

Company Description

OneMain Holdings, Inc., a financial service holding company, engages in the consumer finance and insurance businesses. The company originates, underwrites, and services personal loans secured by automobiles, other titled collateral, or unsecured. The company also offers credit cards and insurance products comprising life, disability, and involuntary unemployment insurance; optional non-credit insurance; guaranteed asset protection coverage as a waiver product or insurance; and membership plans. It operates through a network of approximately 1,400 branch offices in 44 states in the United States, as well as through its website onemainfinancial.com. The company was formerly known as Springleaf Holdings, Inc. and changed its name to OneMain Holdings, Inc. in November 2015. OneMain Holdings, Inc. was founded in 1912 and is based in Evansville, Indiana.

How the Company Makes Money

OneMain Holdings generates revenue primarily through the interest and fees charged on personal loans issued to its customers. These loans typically cater to non-prime borrowers who may not qualify for credit from traditional financial institutions, allowing OneMain to charge higher interest rates to mitigate risk. Additionally, the company earns money from the sale of credit insurance products, which are often bundled with its loans, providing customers with financial protection in the event of unforeseen circumstances. OneMain's revenue model is supported by its extensive network of branches and a robust online presence, enabling it to reach a broad customer base. Key factors contributing to its earnings include effective risk management strategies, customer retention initiatives, and strategic partnerships that enhance its service offerings.

OneMain Holdings Financial Statement Overview

Summary

OneMain Holdings exhibits strong revenue growth and profitability, but a declining net profit margin raises concerns. The balance sheet's high leverage indicates potential risk, while cash flow metrics show robust cash conversion despite a slowdown in free cash flow growth.

Income Statement

The income statement demonstrates strong profitability, with high gross and EBIT margins of 75.68% and 71.67% respectively for the TTM. However, net profit margin decreased to 11.61% TTM from 25.04% in the previous year. Revenue growth was significant, with a TTM increase of 71.24% compared to the previous year. Despite this, the decline in net profit margin indicates potential pressure on net income.

Balance Sheet

The balance sheet shows high leverage, with a debt-to-equity ratio of 6.72 TTM, indicating significant reliance on debt financing. The equity ratio is low at 12.32%, suggesting limited equity buffer. Return on Equity (ROE) is relatively modest at 15.95% TTM, reflecting moderate profitability against equity.

Cash Flow

The cash flow statement indicates strong cash generation with an operating cash flow to net income ratio of 3.84 TTM. Free cash flow remained stable, and the free cash flow to net income ratio was high at 3.84 TTM, suggesting efficient conversion of income to cash flow. However, the free cash flow growth rate is negative, indicating a decline from the previous year.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
695.00M	2.56B	4.20B	4.04B	3.91B
	Gross Profit
-184.00M	-26.00M	3.42B	3.33B	3.20B
	EBIT
-2.13B	1.63B	1.79B	1.74B	977.00M
	EBITDA
0.00	2.12B	2.34B	0.00	2.34B
	Net Income Common Stockholders
509.00M	641.00M	872.00M	1.31B	730.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
2.06B	1.55B	498.00M	1.02B	2.42B
	Total Assets
25.91B	24.29B	22.53B	22.08B	22.47B
	Total Debt
21.44B	19.81B	18.28B	17.75B	17.80B
	Net Debt
20.98B	18.80B	17.78B	17.21B	15.53B
	Total Liabilities
22.72B	21.11B	19.50B	17.75B	17.84B
	Stockholders Equity
3.19B	3.19B	3.03B	3.09B	3.44B
Cash Flow		Free Cash Flow
2.70B	2.52B	2.39B	2.25B	2.21B
	Operating Cash Flow
2.70B	2.52B	2.39B	2.25B	2.21B
	Investing Cash Flow
-3.27B	-2.86B	-2.12B	-2.14B	-751.00M
	Financing Cash Flow
130.00M	932.00M	-326.00M	-1.81B	-370.00M

OneMain Holdings Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 43.65
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OMF, the sentiment is Negative. The current price of 43.65 is below the 20-day moving average (MA) of 46.17, below the 50-day MA of 49.54, and below the 200-day MA of 49.23, indicating a bearish trend. The MACD of -1.71 indicates Negative momentum. The RSI at 42.10 is Neutral, neither overbought nor oversold. The STOCH value of 72.85 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for OMF.

OneMain Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
YRD	84 Outperform	$495.53M	2.26	17.96%	3.16%	17.07%	-8.81%
WRLD	79 Outperform	$717.53M	8.84	19.28%	―	-2.78%	24.39%
ENVA	76 Outperform	$2.35B	12.27	17.19%	―	25.51%	36.96%
CACC	70 Outperform	$5.68B	23.78	14.15%	―	13.70%	-9.00%
BFH	63 Neutral	$2.30B	8.53	9.31%	1.79%	-3.06%	-61.20%
Sector *	63 Neutral	$12.00B	9.27	8.14%	79.61%	12.85%	-5.12%
OMF	63 Neutral	$5.15B	10.18	15.96%	9.37%	7.96%	-20.11%

OneMain Holdings Corporate Events

OneMain Holdings Elects Andrew Macdonald to Board

On March 17, 2025, OneMain Holdings, Inc. announced the election of Andrew D. Macdonald to its Board of Directors. Macdonald, who is the CEO of Consilio LLC, brings extensive experience in legal technology solutions and enterprise legal services. His appointment is expected to enhance OneMain’s mission of improving financial well-being through his proven track record in leveraging technology and data science for business growth. The company continues to seek additional independent directors to strengthen its board.

OneMain Holdings Reports Q4 2024 Financial Results

On January 31, 2025, OneMain Holdings reported its financial results for the fourth quarter of 2024, highlighting a quarterly net income of $126 million, a decrease from the previous year, alongside declaring a dividend of $1.04 per share. The company’s managed receivables grew to $24.7 billion, reflecting an 11% increase, with improvements in credit trends and consumer loan originations up by 16% from the previous year, indicating positive momentum for future profitability and shareholder value.