Head to Head Comparison: Paymentus (NYSE:PAY) versus Fiserv (NASDAQ:FISV)

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

Volatility and Risk

Fiserv has a beta of 0.9, suggesting that its share price is 10% less volatile than the S&P 500. Comparatively, Paymentus has a beta of 1.48, suggesting that its share price is 48% more volatile than the S&P 500.

Insider & Institutional Ownership

91.0% of Fiserv shares are held by institutional investors. Comparatively, 78.4% of Paymentus shares are held by institutional investors. 1.0% of Fiserv shares are held by insiders. Comparatively, 87.8% of Paymentus shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Valuation and Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Fiserv	$21.16 billion	1.58	$3.13 billion	$6.47	9.50
Paymentus	$871.74 million	5.00	$44.17 million	$0.46	75.49

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

Analyst Ratings

This is a breakdown of current recommendations and price targets for Fiserv and Paymentus, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Fiserv	2	23	11	0	2.25
Paymentus	0	4	4	0	2.50

Fiserv presently has a consensus target price of $121.08, indicating a potential upside of 96.98%. Paymentus has a consensus target price of $37.00, indicating a potential upside of 6.55%. Given Fiserv’s higher possible upside, analysts clearly believe Fiserv is more favorable than Paymentus.

Profitability

This table compares Fiserv and Paymentus’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Fiserv	17.05%	19.47%	6.43%
Paymentus	5.29%	12.68%	10.68%

Summary

Fiserv beats Paymentus on 8 of the 14 factors compared between the two stocks.

About Fiserv

Fiserv, Inc., together with its subsidiaries, provides payments and financial services technology services in the United States, Europe, the Middle East and Africa, Latin America, the Asia-Pacific, and internationally. It operates through Merchant Acceptance, Financial Technology, and Payments and Network segments. The Merchant Acceptance segment provides merchant acquiring and digital commerce services; mobile payment services; security and fraud protection products; Clover, a cloud based POS and integrated commerce operating system for small and mid-sized businesses and independent software vendors; and Carat, an integrated operating system for large businesses. This segment distributes through various channels, including direct sales teams, strategic partnerships with agent sales forces, independent software vendors, financial institutions, and other strategic partners in the form of joint venture alliances, revenue sharing alliances, and referral agreement. The Financial Technology segment offers customer deposit and loan accounts, as well as manages an institution's general ledger and central information files. This segment also provides digital banking, financial and risk management, professional services and consulting, check processing, and other products and services. The Payments and Network segment offers card transactions, such as debit, credit, and prepaid card processing and services; funds access, debit payments, cardless ATM access, and surcharge-free ATM network; security and fraud protection products; card production; print services; and various network services, as well as non-card digital payment software and services, including bill payment, account-to-account transfers, person-to-person payments, electronic billing, and security and fraud protection products. It serves merchants, banks, credit unions, other financial institutions, and corporate clients. Fiserv, Inc. was incorporated in 1984 and is headquartered in Milwaukee, Wisconsin.

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.