Critical Survey: Paysign (NASDAQ:PAYS) and Paysafe (NYSE:PSFE)

Paysign (NASDAQ:PAYS) and Paysafe (NYSE:PSFE) are both small-cap business services companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, analyst recommendations, valuation, profitability, risk, dividends and earnings.

Valuation and Earnings

This table compares Paysign and Paysafe”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Paysign	$82.03 million	4.31	$7.55 million	$0.13	49.23
Paysafe	$1.70 billion	0.28	-$182.51 million	($3.15)	-2.92

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

Profitability

This table compares Paysign and Paysafe’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Paysign	9.21%	17.19%	3.41%
Paysafe	-10.73%	11.55%	1.83%

Volatility & Risk

Paysign has a beta of 0.64, indicating that its share price is 36% less volatile than the S&P 500. Comparatively, Paysafe has a beta of 1.66, indicating that its share price is 66% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations for Paysign and Paysafe, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Paysign	0	1	3	0	2.75
Paysafe	2	4	1	0	1.86

Paysign currently has a consensus target price of $9.42, suggesting a potential upside of 47.14%. Paysafe has a consensus target price of $9.81, suggesting a potential upside of 6.63%. Given Paysign’s stronger consensus rating and higher probable upside, research analysts plainly believe Paysign is more favorable than Paysafe.

Insider and Institutional Ownership

25.9% of Paysign shares are owned by institutional investors. Comparatively, 54.4% of Paysafe shares are owned by institutional investors. 24.5% of Paysign shares are owned by 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.

Summary

Paysign beats Paysafe on 11 of the 14 factors compared between the two stocks.

About Paysign

Paysign, Inc. provides prepaid card programs, comprehensive patient affordability offerings, digital banking services, and integrated payment processing services for businesses, consumers, and government institutions. Its product offerings include solutions for corporate rewards, prepaid gift cards, general purpose reloadable debit cards, employee incentives, consumer rebates, donor compensation, clinical trials, healthcare reimbursement payments and pharmaceutical payment assistance, and demand deposit accounts accessible with a debit card. The company markets its prepaid card solutions under the Paysign brand. Its primary market focus is on companies and municipalities that require a streamlined payment solution for rewards, rebates, payment assistance, and other payments to their customers, employees, agents, and others. The company was formerly known as 3PEA International, Inc. and changed its name to Paysign, Inc. in April 2019. Paysign, Inc. was incorporated in 1995 and is headquartered in Henderson, Nevada.

About Paysafe

Paysafe Limited provides end-to-end payment solutions in the United States, Germany, the United Kingdom, and internationally. Its payments platform offers a range of payment solutions comprising credit and debit card processing, digital wallet, eCash, and real-time banking solutions for entertainment verticals, such as iGaming, including online betting related to sports, e-sports, fantasy sports, poker, and other casino games, as well as travel, streaming/video gaming, retail/hospitality, and digital assets. The company operates through two segments, Merchant Solutions and Digital Wallets. The Merchant Solutions segment offers PCI-compliant payment acceptance and transaction processing solutions for merchants and integrated service providers, including merchant acquiring, transaction processing, gateway solutions, fraud and risk management tools, data and analytics, point of sale systems, and merchant financing solutions, as well as comprehensive support services under the Paysafe and Petroleum Card Services brands. The Digital Wallets segment offers digital wallet solutions under the Skrill, NETELLER, paysafecard, and Paysafecash brands; and pay-by-bank solutions under the Rapid Transfer brand. It also provides eCash solutions under the paysafecard and Paysafecash brands; paysafecard prepaid Mastercard that can be linked to a digital paysafecard account and used to make purchases; Safetypay, a platform that enables eCommerce transactions; and PagoEfectivo, an alternative payment platform. The company is based in London, the United Kingdom.