Financial Contrast: Shift4 Payments (NYSE:FOUR) vs. FirstCash (NASDAQ:FCFS)

Shift4 Payments (NYSE:FOUR) and FirstCash (NASDAQ:FCFS) are both mid-cap business services companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, risk, valuation, analyst recommendations, earnings, dividends and profitability.

Earnings & Valuation

This table compares Shift4 Payments and FirstCash”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Shift4 Payments	$4.18 billion	0.94	$119.00 million	$1.05	46.11
FirstCash	$3.66 billion	2.49	$330.38 million	$7.42	28.04

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Shift4 Payments	2.84%	39.27%	5.60%
FirstCash	9.02%	17.99%	8.03%

Volatility & Risk

Shift4 Payments has a beta of 1.6, indicating that its stock price is 60% more volatile than the S&P 500. Comparatively, FirstCash has a beta of 0.47, indicating that its stock price is 53% less volatile than the S&P 500.

Insider & Institutional Ownership

98.9% of Shift4 Payments shares are owned by institutional investors. Comparatively, 80.3% of FirstCash shares are owned by institutional investors. 25.2% of Shift4 Payments shares are owned by company insiders. Comparatively, 14.8% of FirstCash shares are owned 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.

Analyst Ratings

This is a summary of current recommendations and price targets for Shift4 Payments and FirstCash, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Shift4 Payments	1	10	12	0	2.48
FirstCash	0	2	2	2	3.00

Shift4 Payments presently has a consensus target price of $73.90, suggesting a potential upside of 52.62%. FirstCash has a consensus target price of $183.25, suggesting a potential downside of 11.93%. Given Shift4 Payments’ higher probable upside, equities analysts plainly believe Shift4 Payments is more favorable than FirstCash.

Summary

Shift4 Payments beats FirstCash on 8 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 FirstCash

FirstCash Holdings, Inc, together with its subsidiaries, operates retail pawn stores in the United States, Mexico, and rest of Latin America. The company operates in three segments: U.S. Pawn, Latin America Pawn, and Retail POS Payment Solutions segments. Its pawn stores lend money on the collateral of pledged personal property, including jewelry, electronics, tools, appliances, sporting goods, and musical instruments; and retails merchandise acquired through collateral forfeitures on forfeited pawn loans and over-the-counter purchases of merchandise directly from customers. The company also provides retail POS payment solutions, which focuses on LTO products and facilitating other retail financing payment options across the network of traditional and e-commerce merchant partners. It serves cash and credit-constrained consumers. The company was formerly known as FirstCash, Inc and changed its name to FirstCash Holdings, Inc. in December 2021. FirstCash Holdings, Inc was incorporated in 1988 and is headquartered in Fort Worth, Texas.