Payment Data Systems (NASDAQ: PYDS) and Euronet Worldwide (NASDAQ:EEFT) are both business services companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, earnings, valuation, risk, profitability, analyst recommendations and dividends.

Risk & Volatility

Payment Data Systems has a beta of 0.77, suggesting that its share price is 23% less volatile than the S&P 500. Comparatively, Euronet Worldwide has a beta of 1.5, suggesting that its share price is 50% more volatile than the S&P 500.

Earnings & Valuation

This table compares Payment Data Systems and Euronet Worldwide’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Payment Data Systems $14.57 million 1.81 -$3.00 million N/A N/A
Euronet Worldwide $2.25 billion 1.94 $156.84 million $4.33 19.66

Euronet Worldwide has higher revenue and earnings than Payment Data Systems.

Insider & Institutional Ownership

1.1% of Payment Data Systems shares are owned by institutional investors. 46.6% of Payment Data Systems shares are owned by insiders. Comparatively, 7.4% of Euronet Worldwide shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of current recommendations and price targets for Payment Data Systems and Euronet Worldwide, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Payment Data Systems 0 0 1 0 3.00
Euronet Worldwide 0 2 6 0 2.75

Payment Data Systems currently has a consensus target price of $4.00, suggesting a potential upside of 140.96%. Euronet Worldwide has a consensus target price of $107.14, suggesting a potential upside of 25.89%. Given Payment Data Systems’ stronger consensus rating and higher probable upside, equities analysts clearly believe Payment Data Systems is more favorable than Euronet Worldwide.

Profitability

This table compares Payment Data Systems and Euronet Worldwide’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Payment Data Systems -21.43% -29.43% -5.18%
Euronet Worldwide 6.66% 20.77% 7.62%

Summary

Euronet Worldwide beats Payment Data Systems on 8 of the 12 factors compared between the two stocks.

About Payment Data Systems

Payment Data Systems, Inc., together with its subsidiaries, provides integrated electronic payment processing services to merchants and businesses in the United States. The company offers various types of automated clearing house (ACH) processing; and credit, prepaid card, and debit card-based processing services. Its ACH processing services include Represented Check, a consumer non-sufficient funds check that is represented for payment electronically rather than through the paper check collection system; and Accounts Receivable Check Conversion, a consumer paper check payment, which is converted into an e-check. The company also offers merchant account services for the processing of card-based transactions through the VISA, MasterCard, American Express, Discover, and JCB networks, including online terminal services accessed through a Website or retail services accessed through a physical terminal. In addition, it provides a proprietary Web-based customer service application that allows companies to process one-time and recurring payments through e-checks or credit cards; and an interactive voice response telephone system to companies, which accept payments directly from consumers over the telephone using e-checks or credit cards. Further, the company creates, manages, and processes prepaid card programs for corporate clients to issue prepaid cards to their customer base or employees; and issues general purpose reloadable cards to consumers as an alternative to a traditional bank account. Additionally, it operates billx.com, a consumer Website that allows consumers to process online payments to pay other individual; and provides prepaid cards to consumers for use in as a tool to stay on budget, manage allowances, and share money with family and friends. The company markets and sells its products and services directly, as well as through non-exclusive resellers. Payment Data Systems, Inc. was founded in 1998 and is headquartered in San Antonio, Texas.

About Euronet Worldwide

Euronet Worldwide, Inc. provides payment and transaction processing and distribution solutions to financial institutions, retailers, service providers, and individual consumers worldwide. The company operates in three segments: Electronic Financial Transaction (EFT) Processing, epay, and Money Transfer. The EFT Processing segment provides electronic payment solutions, including automated teller machine (ATM) cash withdrawal and deposit services, ATM network participation, outsourced ATM and point-of-sale (POS) management solutions, credit and debit card outsourcing, card issuing, and merchant acquiring services. This segment also offers ATM and POS dynamic currency conversion, advertising, customer relationship management, mobile top-up, bill payment, fraud management, and foreign remittance payout services; and integrated EFT software solutions for electronic payments and transaction delivery systems. As of December 31, 2017, it operated a network of 37,133 ATMs; and approximately 248,000 EFT POS terminals. The epay segment provides distribution, processing, and collection services for prepaid mobile airtime and other electronic payment products; and vouchers and physical gift fulfillment, and gift card distribution and processing services. This segment operated a network of approximately 707,000 POS terminals. The Money Transfer segment provides consumer-to-consumer money transfer services primarily under the Ria, AFEX Money Express, and IME brands; account-to-account money transfer services under the HiFX and xe brands; customers bill payment services; payment alternatives, such as money orders and prepaid debit cards; check cashing services; foreign currency exchange and mobile top-up services; and cash management and foreign currency risk management services. The company was formerly known as Euronet Services, Inc. and changed its name to Euronet Worldwide, Inc. in August 2001. Euronet Worldwide, Inc. was founded in 1994 and is headquartered in Leawood, Kansas.

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