On Tuesday, OneMain Holdings, Inc. (NYSE:OMF) saw its shareprice target raised by an analyst at Jefferies from $55.00 to $56.00. The firm also reiterated its Buy rating on the stock. This adjustment follows the completion of OneMain's acquisition of Foursight Capital, effectively expanding the company's presence in the auto finance sector with a well-established platform.
Jefferies updated its model for OneMain to reflect the recent acquisition, the company's fourth-quarter results from 2023, the guidance provided by the company, and the current credit outlook. The analyst anticipates a normalization of earnings per share (EPS) in 2025 following what is expected to be a peak non-performing loans (NCO) cycle in 2024.
The firm highlighted OneMain's robust capacity for capital generation and its substantial capital return, noting an approximately 8% dividend yield. The positive outlook on OneMain is based on these financial strengths and the strategic growth from the recent Foursight Capital acquisition.
The revised price target of $56.00 reflects confidence in the company's future performance and the potential for shareholder value increase. OneMain's stock rating remains at Buy, signaling continued optimism about its investment potential amidst the recent strategic developments.
InvestingPro Insights
Following the optimistic assessment by Jefferies, OneMain Holdings, Inc. (NYSE:OMF) showcases a compelling financial profile, as underlined by key metrics from InvestingPro. The company's market capitalization stands at a robust $6.02 billion, and it boasts an attractive P/E ratio of 9.45, which further adjusts to 9.39 when considering the last twelve months as of Q4 2023. This indicates a favorable valuation relative to earnings.
InvestingPro Tips highlight that OneMain pays a significant dividend to shareholders, with a noteworthy dividend yield of 7.96% as of the latest data, paired with a dividend growth of 5.26% in the last twelve months.
This aligns with Jefferies' emphasis on OneMain's substantial capital return and reinforces the stock's appeal for income-focused investors. Additionally, the company's stock has experienced a large price uptick of 34.26% over the last six months, signaling strong market momentum.
Investors considering OneMain may find additional insights through InvestingPro, which offers a total of 9 tips for OMF. For a deeper analysis and more exclusive tips, visit https://www.investing.com/pro/OMF and use the coupon code PRONEWS24 to receive an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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