Contrasting Marqeta (NASDAQ:MQ) and Mastercard (NYSE:MA)

Marqeta (NASDAQ:MQ) and Mastercard (NYSE:MA) are both business services companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, earnings, dividends, profitability, analyst recommendations, valuation and risk.

Analyst Ratings

This is a summary of current recommendations for Marqeta and Mastercard, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Marqeta	0	10	3	0	2.23
Mastercard	0	5	24	3	2.94

Marqeta presently has a consensus target price of $5.55, suggesting a potential downside of 3.22%. Mastercard has a consensus target price of $612.90, suggesting a potential upside of 10.93%. Given Mastercard’s stronger consensus rating and higher possible upside, analysts plainly believe Mastercard is more favorable than Marqeta.

Valuation and Earnings

This table compares Marqeta and Mastercard”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Marqeta	$506.99 million	5.29	$27.29 million	$0.10	57.30
Mastercard	$29.07 billion	17.33	$12.87 billion	$14.26	38.75

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

Institutional & Insider Ownership

78.6% of Marqeta shares are owned by institutional investors. Comparatively, 97.3% of Mastercard shares are owned by institutional investors. 12.1% of Marqeta shares are owned by company insiders. Comparatively, 0.1% of Mastercard shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Marqeta and Mastercard’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Marqeta	10.43%	5.11%	3.84%
Mastercard	45.21%	196.87%	29.77%

Volatility & Risk

Marqeta has a beta of 1.54, indicating that its share price is 54% more volatile than the S&P 500. Comparatively, Mastercard has a beta of 1.02, indicating that its share price is 2% more volatile than the S&P 500.

Summary

Mastercard beats Marqeta on 12 of the 15 factors compared between the two stocks.

About Marqeta

Marqeta, Inc. operates a cloud-based open application programming interface platform that delivers card issuing and transaction processing services. It offers its solutions in various verticals, including financial services, on-demand services, expense management, and e-commerce enablement, as well as buy now, pay later. Marqeta, Inc. was incorporated in 2010 and is headquartered in Oakland, California.

About Mastercard

Mastercard Incorporated, a technology company, provides transaction processing and other payment-related products and services in the United States and internationally. The company offers integrated products and value-added services for account holders, merchants, financial institutions, digital partners, businesses, governments, and other organizations, such as programs that enable issuers to provide consumers with credits to defer payments; payment products and solutions that allow its customers to access funds in deposit and other accounts; prepaid programs services; and commercial credit, debit, and prepaid payment products and solutions. It also provides solutions that enable businesses or governments to make payments to businesses, including Virtual Card Number, which is generated dynamically from a physical card and leverages the credit limit of the funding account; a platform to optimize supplier payment enablement campaigns for financial institutions; and treasury intelligence platform that offers corporations with recommendations to enhance working capital performance and accelerate spend on cards. In addition, the company offers Mastercard Send, which partners with digital messaging and payment platforms to enable consumers to send money directly within applications to other consumers; and Mastercard Cross-Border Services enables a range of payment flows through a distribution network with a single point of access to send and receive money globally through various channels, including bank accounts, mobile wallets, cards, and cash payouts. Further, it provides cyber and intelligence solutions; insights and analytics, consulting, marketing, loyalty, processing, and payment gateway solutions for e-commerce merchants; and open banking and digital identity services. The company offers payment solutions and services under the MasterCard, Maestro, and Cirrus name. Mastercard Incorporated was founded in 1966 and is headquartered in Purchase, New York.