Analyzing Paymentus (NYSE:PAY) & Visa (NYSE:V)

Paymentus (NYSE:PAY) and Visa (NYSE:V) are both business services companies, but which is the superior business? We will compare the two companies based on the strength of their analyst recommendations, risk, profitability, dividends, valuation, institutional ownership and earnings.

Profitability

This table compares Paymentus and Visa’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Paymentus	5.29%	12.68%	10.68%
Visa	50.23%	61.74%	23.84%

Institutional and Insider Ownership

78.4% of Paymentus shares are held by institutional investors. Comparatively, 82.2% of Visa shares are held by institutional investors. 75.4% of Paymentus shares are held by company insiders. Comparatively, 0.1% of Visa shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Paymentus and Visa”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Paymentus	$1.12 billion	2.58	$44.17 million	$0.46	50.20
Visa	$40.00 billion	14.25	$20.06 billion	$10.66	29.47

Visa has higher revenue and earnings than Paymentus. Visa is trading at a lower price-to-earnings ratio than Paymentus, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Paymentus has a beta of 1.49, indicating that its stock price is 49% more volatile than the S&P 500. Comparatively, Visa has a beta of 0.79, indicating that its stock price is 21% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and price targets for Paymentus and Visa, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Paymentus	0	4	4	0	2.50
Visa	0	3	21	6	3.10

Paymentus currently has a consensus target price of $37.50, suggesting a potential upside of 62.41%. Visa has a consensus target price of $392.21, suggesting a potential upside of 24.86%. Given Paymentus’ higher probable upside, analysts clearly believe Paymentus is more favorable than Visa.

Summary

Visa beats Paymentus on 11 of the 15 factors compared between the two stocks.

About Paymentus

Paymentus Holdings, Inc. provides cloud-based bill payment technology and solutions in the United States and internationally. The company offers electronic bill presentment and payment services, enterprise customer communication, and self-service revenue management to billers through a software-as-a-service technology platform. Its platform's payment processing includes credit cards, debit cards, eChecks, and digital wallets. It serves utility, financial service, government, insurance, telecommunication, real estate management, education, consumer finance, healthcare, and small business industries. The company was founded in 2004 and is headquartered in Charlotte, North Carolina.

About Visa

Visa Inc. operates as a payment technology company in the United States and internationally. The company operates VisaNet, a transaction processing network that enables authorization, clearing, and settlement of payment transactions. It also offers credit, debit, and prepaid card products; tap to pay, tokenization, and click to pay services; Visa Direct, a solution that facilitates the delivery of funds to eligible cards, deposit accounts, and digital wallets; Visa B2B Connect, a multilateral business-to-business cross-border payments network; Visa Cross-Border Solution, a cross-border consumer payments solution; and Visa DPS that provides a range of value-added services, including fraud mitigation, dispute management, data analytics, campaign management, a suite of digital solutions, and contact center services. The company also provides acceptance solutions, which include Cybersource that provides modular and value-added services for connecting merchants to payment processing; risk and identity solutions, such as Visa Advanced Authorization, Visa Secure, Visa Risk and Decision Manager, Visa Consumer Authentication Service, and payment-decisioning solutions for fraud prevention; and Visa Consulting and Analytics, a payment consulting advisory services. It provides its services under the Visa, Visa Electron, Interlink, V PAY, and PLUS brand names. The company serves merchants, financial institutions, and government entities. Visa Inc. was founded in 1958 and is headquartered in San Francisco, California.