Reviewing Paymentus (NYSE:PAY) and Visa (NYSE:V)

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

Analyst Ratings

This is a breakdown of current ratings 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	20	6	3.10

Paymentus presently has a consensus price target of $37.50, suggesting a potential upside of 59.91%. Visa has a consensus price target of $392.21, suggesting a potential upside of 22.90%. Given Paymentus’ higher possible upside, equities analysts plainly believe Paymentus is more favorable than Visa.

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 & Insider Ownership

78.4% of Paymentus shares are held by institutional investors. Comparatively, 82.2% of Visa shares are held by institutional investors. 87.8% of Paymentus shares are held by insiders. Comparatively, 0.1% of Visa shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Paymentus and Visa”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Paymentus	$871.74 million	3.37	$44.17 million	$0.46	50.98
Visa	$40.00 billion	14.48	$20.06 billion	$10.66	29.94

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.

Risk & Volatility

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

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.