OneMain (NYSE:OMF) Shares Break Below Fifty Day Moving Average - Should You Sell?

Key Points

• OneMain shares fell below their 50-day moving average, trading as low as $55.42 versus the $60.37 average, signaling recent technical weakness.
• Despite mixed analyst actions, the stock retains a “Moderate Buy” consensus with an average price target of $67.09, well above its recent trading level.
• OneMain reported better-than-expected quarterly earnings and maintains an attractive 7.5% dividend yield, though company insiders recently sold shares.

OneMain Holdings, Inc. (NYSE:OMF - Get Free Report) passed below its fifty day moving average during trading on Monday. The stock has a fifty day moving average of $60.37 and traded as low as $55.42. OneMain shares last traded at $55.8210, with a volume of 783,761 shares.

Wall Street Analyst Weigh In

A number of brokerages recently commented on OMF. Citizens Jmp boosted their target price on OneMain from $68.00 to $70.00 and gave the company a "market outperform" rating in a research report on Thursday, July 30th. JPMorgan Chase & Co. cut their price target on OneMain from $60.00 to $52.00 and set an "underweight" rating on the stock in a report on Monday, October 12th. TD Cowen reduced their price objective on OneMain from $68.00 to $66.00 and set a "buy" rating for the company in a research note on Tuesday, October 6th. Weiss Ratings cut OneMain from a "buy (b-)" rating to a "hold (c+)" rating in a research note on Friday. Finally, Citigroup restated a "market outperform" rating on shares of OneMain in a report on Thursday, July 30th. Eight equities research analysts have rated the stock with a Buy rating, four have assigned a Hold rating and one has issued a Sell rating to the stock. According to data from MarketBeat, the stock presently has an average rating of "Moderate Buy" and a consensus target price of $67.09.

OneMain Stock Down 0.2%

The stock has a 50-day simple moving average of $60.37 and a 200-day simple moving average of $58.73. The firm has a market capitalization of $6.42 billion, a PE ratio of 8.41, a P/E/G ratio of 0.63 and a beta of 1.24.

OneMain (NYSE:OMF - Get Free Report) last released its quarterly earnings data on Wednesday, July 29th. The financial services provider reported $1.31 earnings per share for the quarter, beating analysts' consensus estimates of $1.26 by $0.05. The business had revenue of $1.62 billion during the quarter, compared to analyst estimates of $1.28 billion. OneMain had a net margin of 13.92% and a return on equity of 23.49%. OneMain's revenue was up 6.7% compared to the same quarter last year. During the same period in the previous year, the business earned $1.45 EPS. Equities analysts forecast that OneMain Holdings, Inc. will post 6.73 earnings per share for the current fiscal year.

OneMain Announces Dividend

The business also recently declared a quarterly dividend, which was paid on Friday, August 14th. Stockholders of record on Monday, August 10th were given a $1.05 dividend. The ex-dividend date was Monday, August 10th. This represents a $4.20 annualized dividend and a dividend yield of 7.5%. OneMain's payout ratio is 63.25%.

Insiders Place Their Bets

In other OneMain news, COO Micah R. Conrad sold 5,000 shares of the firm's stock in a transaction dated Tuesday, August 4th. The stock was sold at an average price of $65.40, for a total value of $327,000.00. Following the completion of the transaction, the chief operating officer owned 91,250 shares in the company, valued at $5,967,750. This trade represents a 5.19% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available through this hyperlink. Also, SVP Michael A. Hedlund sold 2,500 shares of the firm's stock in a transaction dated Wednesday, July 29th. The stock was sold at an average price of $64.00, for a total value of $160,000.00. Following the completion of the transaction, the senior vice president owned 10,627 shares of the company's stock, valued at approximately $680,128. This represents a 19.04% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders own 0.29% of the company's stock.

Institutional Investors Weigh In On OneMain

Several hedge funds and other institutional investors have recently modified their holdings of OMF. BlackRock Inc. purchased a new position in shares of OneMain during the 2nd quarter valued at $633,893,000. Jupiter Topco LLC bought a new position in shares of OneMain in the second quarter worth $166,060,000. Bank of New York Mellon Corp purchased a new stake in shares of OneMain in the second quarter worth $63,980,000. Azora Capital LP raised its position in shares of OneMain by 266.0% in the second quarter. Azora Capital LP now owns 1,063,857 shares of the financial services provider's stock worth $64,863,000 after buying an additional 773,192 shares in the last quarter. Finally, Patient Capital Management LLC purchased a new stake in shares of OneMain in the second quarter worth $42,824,000. 85.82% of the stock is currently owned by institutional investors.

About OneMain

OneMain Holdings, Inc, operating under the OneMain Financial brand, is a consumer finance company that provides personal lending and related financial services primarily to non-prime consumers in the United States. The company serves customers through a combination of branch locations, online and mobile channels, and centralized customer service operations.

OneMain's principal products include secured and unsecured personal loans, which customers may use for debt consolidation, home improvements, major purchases, and other personal expenses.

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