Shift4 Payments (NYSE:FOUR) versus Repay (NASDAQ:RPAY) Critical Analysis

Shift4 Payments (NYSE:FOUR) and Repay (NASDAQ:RPAY) are both business services companies, but which is the superior investment? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, profitability, valuation, dividends, earnings and risk.

Volatility & Risk

Shift4 Payments has a beta of 1.8, meaning that its share price is 80% more volatile than the S&P 500. Comparatively, Repay has a beta of 1.59, meaning that its share price is 59% more volatile than the S&P 500.

Profitability

This table compares Shift4 Payments and Repay’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Shift4 Payments	6.50%	32.97%	7.17%
Repay	-4.16%	8.49%	4.31%

Analyst Recommendations

This is a summary of recent ratings and price targets for Shift4 Payments and Repay, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Shift4 Payments	0	5	14	2	2.86
Repay	0	4	5	0	2.56

Shift4 Payments currently has a consensus price target of $116.70, indicating a potential upside of 9.50%. Repay has a consensus price target of $7.90, indicating a potential upside of 60.90%. Given Repay’s higher probable upside, analysts plainly believe Repay is more favorable than Shift4 Payments.

Insider & Institutional Ownership

98.9% of Shift4 Payments shares are owned by institutional investors. Comparatively, 82.7% of Repay shares are owned by institutional investors. 25.2% of Shift4 Payments shares are owned by insiders. Comparatively, 12.0% of Repay shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Shift4 Payments and Repay”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Shift4 Payments	$3.33 billion	2.84	$229.60 million	$2.96	36.01
Repay	$313.04 million	1.56	-$10.16 million	($0.15)	-32.73

Shift4 Payments has higher revenue and earnings than Repay. Repay is trading at a lower price-to-earnings ratio than Shift4 Payments, indicating that it is currently the more affordable of the two stocks.

Summary

Shift4 Payments beats Repay on 14 of the 15 factors compared between the two stocks.

About Shift4 Payments

Shift4 Payments, Inc. (NYSE FOUR) provides integrated payment processing and technology solutions in the United States. Its payments platform provides omni-channel card acceptance and processing solutions, including end-to-end payment processing for various payment types; merchant acquiring; proprietary omni-channel gateway; complementary software integrations; integrated and mobile point-of-sale (POS) solutions; security and risk management solutions; and reporting and analytical tools, as well as tokenization, risk management/underwriting, payment device and chargeback management, fraud prevention, and gift card solutions. The company also offers suite of technology solutions, such as Lighthouse, a cloud-based business intelligence tool that includes customer engagement, social media management, online reputation management, scheduling, and product pricing, as well as reporting and analytics; integrated POS for merchants business; and Skytab, a mobile payment solution. In addition, it provides marketplace technology that enable seamless integrations into third-party applications, which includes online delivery services, payroll, timekeeping, and other human resource services. Further, the company offers merchant management, training and education, marketing management, and incentives tracking solutions. Additionally, it provides merchant underwriting, onboarding and activation, training, risk management, and support services; and software integrations and compliance management, and partner support and services. The company was founded in 1998 and is headquartered in Allentown, Pennsylvania.

About Repay

Repay Holdings Corporation, payments technology company, provides integrated payment processing solutions to industry-oriented markets in the United States. It operates through two segments: Consumer Payments and Business Payments. The company's payment processing solutions enable consumers and businesses to make payments using electronic payment methods. It also offers a range of solutions relating to electronic payment methods, including credit and debit card processing, automated clearing house (ACH) processing, e-cash, and digital wallet services; virtual credit card processing, enhanced ACH processing, instant funding, clearing and settlement, and communication solutions; and proprietary payment channels that include Web-based, virtual terminal, online client portal, mobile application, text-to-pay, interactive voice response, and point of sale services. It serves customers primarily operating in the personal loans, automotive loans, receivables management, and business-to-business verticals through direct sales representatives and software integration partners. The company was founded in 2006 and is headquartered in Atlanta, Georgia.