Head-To-Head Comparison: WEX (NYSE:WEX) and CompoSecure (NASDAQ:CMPO)

WEX (NYSE:WEX) and CompoSecure (NASDAQ:CMPO) are both business services companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, earnings, analyst recommendations, valuation, risk, dividends and institutional ownership.

Profitability

This table compares WEX and CompoSecure’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
WEX	11.79%	41.87%	3.71%
CompoSecure	-15.36%	-33.46%	29.35%

Valuation and Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
WEX	$2.63 billion	2.24	$309.60 million	$7.91	21.72
CompoSecure	$420.57 million	3.50	-$53.72 million	($1.10)	-13.06

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

Insider and Institutional Ownership

97.5% of WEX shares are held by institutional investors. Comparatively, 37.6% of CompoSecure shares are held by institutional investors. 1.4% of WEX shares are held by insiders. Comparatively, 52.1% of CompoSecure shares are held 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.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for WEX and CompoSecure, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
WEX	0	12	3	0	2.20
CompoSecure	0	1	7	0	2.88

WEX presently has a consensus price target of $181.50, suggesting a potential upside of 5.64%. CompoSecure has a consensus price target of $16.1875, suggesting a potential upside of 12.65%. Given CompoSecure’s stronger consensus rating and higher possible upside, analysts clearly believe CompoSecure is more favorable than WEX.

Risk & Volatility

WEX has a beta of 1.28, indicating that its share price is 28% more volatile than the S&P 500. Comparatively, CompoSecure has a beta of 0.94, indicating that its share price is 6% less volatile than the S&P 500.

Summary

WEX beats CompoSecure on 8 of the 14 factors compared between the two stocks.

About WEX

WEX Inc. operates a commerce platform in the United States and internationally. The Mobility segment offers fleet vehicle payment solutions, transaction processing, and information management services; and provides account activation and account retention services; authorization and billing inquiries, and account maintenance services; account management; credit and collections services; merchant services; analytics solutions; and ancillary services and offerings. This segment markets its products directly and indirectly to businesses and government agencies with fleets of commercial vehicles; and indirectly through co-branded and private label relationships. The Corporate Payments segment provides payment solutions, including embedded payments; and accounts payable automation and spend management solutions. This segment also markets its products directly and indirectly to customers in travel, fintech, insurance, consumer bill pay, and media verticals. The Benefits Solutions segment offers software-as-a-service (SaaS) platform for consumer directed healthcare benefits and full-service benefit enrollment solutions. In addition, its SaaS platform includes embedded payment solutions and plan administration services for consumer-directed health benefits; COBRA accounts; and benefit enrollment and administration services. Further, it offers custodial and depository services for health savings accounts; and markets its products through third-party administrators, financial institutions, payroll providers, and health plans. The company was formerly known as Wright Express Corporation and changed its name to WEX Inc. in October 2012. WEX Inc. was founded in 1983 and is based in Portland, Maine.

About CompoSecure

CompoSecure, Inc. manufactures and designs metal, composite, and proprietary financial transaction cards in the United States and internationally. Its primary metal form factors include embedded, metal veneer lite, metal veneer, and full metal products. The company also offers Arculus Cold Storage Wallet, a three-factor authentication solution, which supports specific digital assets, including Bitcoin, Ethereum, non-fungible tokens and others. In addition, it offers Payments + Arculus Secure Authenticate, white-labeled cold storage wallet, Payments + Arculus Cold Storage, and Payments + Arculus Authentication + Arculus Cold Storage. The company serves financial institutions, plastic card manufacturers, system integrators, and security specialists. CompoSecure, Inc. was founded in 1910 and is based in Somerset, New Jersey.