Comparing Evertec (NYSE:EVTC) & Fidelity National Information Services (NYSE:FIS)

Evertec (NYSE:EVTC) and Fidelity National Information Services (NYSE:FIS) are both business services companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, profitability, earnings, institutional ownership, risk, analyst recommendations and valuation.

Profitability

This table compares Evertec and Fidelity National Information Services’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Evertec	15.19%	33.27%	9.86%
Fidelity National Information Services	3.58%	21.21%	9.11%

Earnings and Valuation

This table compares Evertec and Fidelity National Information Services”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Evertec	$931.82 million	1.94	$141.59 million	$2.19	13.42
Fidelity National Information Services	$10.68 billion	2.20	$382.00 million	$0.73	62.67

Fidelity National Information Services has higher revenue and earnings than Evertec. Evertec is trading at a lower price-to-earnings ratio than Fidelity National Information Services, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

96.8% of Evertec shares are held by institutional investors. Comparatively, 96.2% of Fidelity National Information Services shares are held by institutional investors. 1.1% of Evertec shares are held by company insiders. Comparatively, 0.2% of Fidelity National Information Services shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Dividends

Evertec pays an annual dividend of $0.20 per share and has a dividend yield of 0.7%. Fidelity National Information Services pays an annual dividend of $1.76 per share and has a dividend yield of 3.8%. Evertec pays out 9.1% of its earnings in the form of a dividend. Fidelity National Information Services pays out 241.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Fidelity National Information Services has increased its dividend for 1 consecutive years. Fidelity National Information Services is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Evertec and Fidelity National Information Services, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Evertec	0	5	2	0	2.29
Fidelity National Information Services	2	7	13	0	2.50

Evertec presently has a consensus price target of $35.80, suggesting a potential upside of 21.85%. Fidelity National Information Services has a consensus price target of $67.45, suggesting a potential upside of 47.43%. Given Fidelity National Information Services’ stronger consensus rating and higher probable upside, analysts clearly believe Fidelity National Information Services is more favorable than Evertec.

Volatility & Risk

Evertec has a beta of 0.84, suggesting that its stock price is 16% less volatile than the S&P 500. Comparatively, Fidelity National Information Services has a beta of 0.9, suggesting that its stock price is 10% less volatile than the S&P 500.

Summary

Fidelity National Information Services beats Evertec on 10 of the 17 factors compared between the two stocks.

About Evertec

EVERTEC, Inc. engages in transaction processing business and financial technology in Latin America and the Caribbean. The company operates through four segments: Payment Services – Puerto Rico & Caribbean; Latin America Payments and Solutions; Merchant Acquiring; and Business Solutions. It provides merchant acquiring services, which enable point of sales and e-commerce merchants to accept and process electronic methods of payment, such as debit, credit, prepaid, and electronic benefit transfer (EBT) cards. In addition, the company offers payment processing services that enable financial institutions and other issuers to manage, support, and facilitate the processing for credit, debit, prepaid, automated teller machines, and EBT card programs; credit and debit card processing, authorization and settlement, and fraud monitoring and control services to debit or credit issuers services. Further, it provides business process management solutions comprising core bank processing, network hosting and management, IT professional, business process outsourcing, item and cash processing, and fulfillment solutions to merchant, fintech, financial institutions, and corporate and government customers. Additionally, the company owns and operates the ATH network, a personal identification number debit networks. It manages a system of electronic payment networks that process approximately six billion transactions. The company sells and distributes its services primarily through direct sales force. It serves financial institutions, merchants, corporations, and government agencies. EVERTEC, Inc. was founded in 1988 and is headquartered in San Juan, Puerto Rico.

About Fidelity National Information Services

Fidelity National Information Services, Inc. engages in the provision of financial services technology solutions for financial institutions, businesses, and developers worldwide. It operates through Banking Solutions, Capital Market Solutions, and Corporate and Other segments. The company provides core processing and ancillary applications; mobile and online banking; fraud, risk management, and compliance; card and retail payment; electronic funds transfer and network; wealth and retirement; and item processing and output solutions. It also offers trading and asset, lending, leveraged and syndicated loan markets, and treasury and risk solutions. The company was founded in 1968 and is headquartered in Jacksonville, Florida.