Yiren Digital Ltd. (NYSE: YRD)

Sector: Financial Services Industry: Credit Services CIK: 0001631761
Market Cap 314.87 Mn
P/B 0.22
P/E 1.79
P/S 0.36
ROIC (Qtr) 68.55
Div Yield % 0.00
Rev 1y % (Qtr) 5.13
Total Debt (Qtr) 7.28 Mn
Debt/Equity (Qtr) 0.01
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About

Yiren Digital Ltd., a Cayman Islands exempted company with limited liability, operates as a leading online consumer finance marketplace in China under the brand name Yiren Credit. The company provides a wide range of financial and lifestyle services, with its primary source of revenue stemming from its financial services business. Yiren Digital's operations are primarily based in China, where it offers a diversified portfolio of loan products to high-quality and underserved borrowers through its advanced AI-powered platform. The company's financial...

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Investment thesis

Bull case

  • Tangible assets of 2.17B provide exceptional 46099.77x coverage of deferred revenue 47050.56, showing strong service capability backing.
  • Strong tangible asset base of 2.17B provides 297.84x coverage of total debt 7.28M, indicating robust asset backing and low credit risk.
  • R&D investment of 63.18M represents healthy 1342.88x of deferred revenue 47050.56, indicating strong future innovation pipeline.
  • Cash position of 598.29M provides strong 12715.84x coverage of deferred revenue 47050.56, ensuring service delivery capability.
  • Retained earnings of 732.19M provide strong 751.61x coverage of intangibles 974157.30, indicating quality earnings retention.

Bear case

  • Investment activities of 0 provide weak support for R&D spending of 63.18M, which is 0x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Operating cash flow of 0 provides insufficient coverage of deferred revenue obligations of 47050.56, which is 0x, raising concerns about future service delivery capabilities.
  • Operating cash flow of 0 provides minimal 0x coverage of tax expenses of 22.05M, suggesting potential tax planning inefficiencies or unsustainable tax positions.
  • Cash position of 598.29M provides only -40.39x coverage of interest expenses of (14.81M), indicating potential refinancing risks in a rising rate environment.
  • Operating cash flow of 0 barely covers operating expenses of 324M with a 0 ratio, suggesting thin operational efficiency margins and limited flexibility.

Timing of Transfer of Good or Service Breakdown of Revenue (2024)

Timing of Transfer of Good or Service Breakdown of Revenue (2024)

Peer comparison

Companies in the Credit Services
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 V Visa Inc. 877.17 Bn 208.55 89.23 21.18 Bn
2 MA Mastercard Inc 642.42 Bn 214.79 82.20 19.00 Bn
3 AXP American Express Co 398.94 Bn 79.20 13.57 57.76 Bn
4 COF Capital One Financial Corp 100.60 Bn 29.83 5.26 51.48 Bn
5 PYPL PayPal Holdings, Inc. 39.11 Bn 7.47 1.18 9.99 Bn
6 SYF Synchrony Financial 36.32 Bn 11.32 4.24 15.18 Bn
7 SOFI SoFi Technologies, Inc. 22.36 Bn 46.45 6.19 1.92 Bn
8 ALLY Ally Financial Inc. 13.05 Bn 47.46 1.66 20.63 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets -0.10 1.15
EV to Cash from Ops. EV/CFO -1.09 13.47
EV to Debt EV to Debt -29.13 3.05
EV to EBIT EV/EBIT -1.16 -258.42
EV to EBITDA EV/EBITDA -0.92 -60.09
EV to Free Cash Flow [EV/FCF] EV/FCF -1.09 15.18
EV to Market Cap EV to Market Cap -0.67 11.30
EV to Revenue EV/Rev -0.24 14.62
Price to Book Value [P/B] P/B 0.22 4.87
Price to Earnings [P/E] P/E 1.79 21.22
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 2.61
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 -4.41
Dividend per Basic Share Div per Share (Qtr) 0.00 0.75
FCF Dividend Payout Ratio % FCF Dividend Payout Ratio % 0.00 5.28
Interest Coverage Int. cover (Qtr) -12.38 -72.18
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex Growth (1y) % 0.00 -80.62
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 10.34 12.15
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 6.19
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -33.93 -32.47
EBITDA Growth (1y) % EBITDA Growth (1y) % 0.00 -5.45
EBIT Growth (1y) % EBIT 1y % (Qtr) -39.29 12.05
EBT Growth (1y) % EBT 1y % (Qtr) -36.76 -22.99
EPS Growth (1y) % EPS 1y % (Qtr) -30.58 -101.12
FCF Growth (1y) % FCF Growth (1y) % 0.00 143.56
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 15.21 8.09
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.06 0.25
Cash Payout Ratio Cash Payout Ratio 0.00 0.11
Cash Ratio Cash Ratio 0.00 0.31
Current Ratio Current Ratio 0.00 0.88
Debt to Equity Ratio Debt/Equity (Qtr) 0.01 5.21
Interest Cover Ratio Int Coverage (Qtr) -12.38 -72.18
Times Interest Earned Times Interest Earned (Qtr) -12.38 -72.18
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % 0.00 -19.26
EBIT Margin % EBIT Margin % (Qtr) 149.60 -7.08
EBT Margin % EBT Margin % (Qtr) 22.71 -29.92
Gross Margin % Gross Margin % (Qtr) 88.20 74.15
Net Profit Margin % Net Margin % (Qtr) 20.20 -44.14