Cass Information Systems (NASDAQ:CASS) and Wageworks (NYSE:WAGE) are both small-cap computer and technology companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, profitability, dividends, valuation, earnings, risk and analyst recommendations.

Analyst Recommendations

This is a breakdown of current recommendations for Cass Information Systems and Wageworks, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cass Information Systems 0 0 0 0 N/A
Wageworks 0 0 5 0 3.00

Wageworks has a consensus price target of $52.12, suggesting a potential upside of 22.72%. Given Wageworks’ higher probable upside, analysts plainly believe Wageworks is more favorable than Cass Information Systems.

Valuation and Earnings

This table compares Cass Information Systems and Wageworks’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Cass Information Systems $148.27 million 4.82 $30.27 million N/A N/A
Wageworks $476.10 million 3.56 $54.39 million $1.38 30.78

Wageworks has higher revenue and earnings than Cass Information Systems.

Profitability

This table compares Cass Information Systems and Wageworks’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Cass Information Systems 20.42% 13.33% 1.84%
Wageworks 6.96% 5.16% 2.00%

Volatility and Risk

Cass Information Systems has a beta of 0.53, meaning that its share price is 47% less volatile than the S&P 500. Comparatively, Wageworks has a beta of 1.55, meaning that its share price is 55% more volatile than the S&P 500.

Institutional & Insider Ownership

53.1% of Cass Information Systems shares are held by institutional investors. 4.6% of Cass Information Systems shares are held by insiders. Comparatively, 3.5% of Wageworks shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Dividends

Cass Information Systems pays an annual dividend of $1.04 per share and has a dividend yield of 2.1%. Wageworks does not pay a dividend. Cass Information Systems has raised its dividend for 14 consecutive years.

Cass Information Systems Company Profile

Cass Information Systems, Inc. provides payment and information processing services to manufacturing, distribution, and retail enterprises in the United States. It operates through two segments, Information Services and Banking Services. The company's services include freight invoice rating, payment processing, auditing, and the generation of accounting and transportation information. It also processes and pays energy invoices, including electricity, gas, waste, and other facility related expenses; and provides telecommunications expense management solutions comprising bill processing, audit, and payment services for telephone, data line, wireless, and communication equipment expenses. In addition, the company, through its banking subsidiary, Cass Commercial Bank, provides a range of commercial banking products and services, such as checking, savings, and time deposit accounts; commercial and commercial real estate loans; and other cash management services to privately-owned businesses and faith-related ministries. Further, it provides B2B payment platform for clients that require an agile fintech partner. It operates through its banking facility near downtown St. Louis, Missouri; operating branch in the Bridgeton, Missouri; and additional leased facilities in Fenton, Missouri, Santa Ana, California, and Colorado Springs, Colorado. The company was formerly known as Cass Commercial Corporation and changed its name to Cass Information Systems, Inc. in January 2001. Cass Information Systems, Inc. was founded in 1906 and is headquartered in St. Louis, Missouri.

Wageworks Company Profile

WageWorks, Inc. is a leader in administering Consumer-Directed Benefits (CDBs). WageWorks is solely dedicated to administering CDBs, including pre-tax spending accounts, such as Health Savings Accounts (HSAs), health and dependent care Flexible Spending Accounts (FSAs), Health Reimbursement Arrangements (HRAs), as well as Commuter Benefit Services, including transit and parking programs, wellness programs, COBRA, and other employee benefits. WageWorks is headquartered in San Mateo, California, with offices in major locations throughout the United States.

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