OneMain Holdings Inc. Common Stock (OMF)

FairStock Score: 76/100 — HIGH CONVICTION

Key Financials

Strengths

• High return on equity of 23.8% demonstrating efficient capital deployment
• Attractive 7.1% dividend yield providing steady income returns
• FairStock composite score of 76/100 places it in the top tier across value, quality, and momentum factors

Concerns

• High leverage at 6.71x debt-to-equity increases financial risk and interest expense burden
• Altman Z-Score of 0.4 places it in the financial distress zone—elevated bankruptcy risk

AI Analysis

OneMain Holdings Inc. Common Stock is a small-cap financial services company valued at $7.0 billion. The business generates $3.0 billion in annual revenue with a 6.9% net margin. From a quality standpoint, OneMain shows distressed Altman Z-Score of 0.4 warrants caution and strong 24% ROE. On valuation, the stock is deeply undervalued on a P/E basis at 9.0x, with a modest 10% margin of safety vs Graham Number. Growth dynamics show revenue growing at 8.6% and profit growth of 61.9%. The 7.1% dividend yield adds an income component for patient holders. Our composite FairStock Score of 76/100 reflects strong fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

The market underappreciates OneMain's consistent 24% ROE at just 9x earnings—a re-rating toward sector peers could unlock 30-50% upside. Operational leverage in the business model means incremental revenue growth could disproportionately boost bottom-line profitability.

Bear Case

Elevated leverage at 6.7x D/E means rising interest rates or revenue weakness could strain debt covenants and force asset sales at distressed prices. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer