Reviewing Global Payments (GPN) & Planet Payment (PLPM)

Global Payments (NYSE: GPN) and Planet Payment (NASDAQ:PLPM) are both business services companies, but which is the better stock? We will contrast the two businesses based on the strength of their risk, analyst recommendations, earnings, valuation, institutional ownership, dividends and profitability.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Global Payments and Planet Payment, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Global Payments 2 3 21 0 2.73
Planet Payment 1 3 1 0 2.00

Global Payments presently has a consensus target price of $100.16, indicating a potential downside of 2.57%. Planet Payment has a consensus target price of $4.50, indicating a potential upside of 0.67%. Given Planet Payment’s higher possible upside, analysts clearly believe Planet Payment is more favorable than Global Payments.

Profitability

This table compares Global Payments and Planet Payment’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Global Payments 6.65% 18.32% 5.26%
Planet Payment 48.14% 25.86% 16.37%

Risk and Volatility

Global Payments has a beta of 1.14, indicating that its stock price is 14% more volatile than the S&P 500. Comparatively, Planet Payment has a beta of 0.63, indicating that its stock price is 37% less volatile than the S&P 500.

Dividends

Global Payments pays an annual dividend of $0.04 per share and has a dividend yield of 0.0%. Planet Payment does not pay a dividend. Global Payments pays out 2.5% of its earnings in the form of a dividend.

Institutional and Insider Ownership

98.0% of Global Payments shares are owned by institutional investors. Comparatively, 47.3% of Planet Payment shares are owned by institutional investors. 0.9% of Global Payments shares are owned by insiders. Comparatively, 20.2% of Planet Payment 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.

Valuation and Earnings

This table compares Global Payments and Planet Payment’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Global Payments $2,898.15 5.41 $271.66 $1.63 63.07
Planet Payment $54.34 4.11 $25.07 $0.47 9.51

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

Summary

Global Payments beats Planet Payment on 10 of the 16 factors compared between the two stocks.

Global Payments Company Profile

Global Payments Inc. is a provider of payment technology services. The Company provides payment and digital commerce solutions. The Company operates through three segments: North America, Europe and Asia-Pacific. The Company’s segments primarily provide payment solutions for credit cards, debit cards, electronic payments and check-related services. The Company’s segments target customers in various industries, including financial services, gaming, government, healthcare, professional services, restaurants, retail, universities, not-for-profit organizations and utilities. It provides services across a range of channels to merchants and partners in over 30 countries throughout North America, Europe, the Asia-Pacific region and Brazil. The Company performs a series of services, including authorization, electronic draft capture, file transfers to facilitate funds settlement and certain exception-based, back office support services, such as chargeback and retrieval resolution.

Planet Payment Company Profile

Planet Payment, Inc. is a provider of international payment and transaction processing and multi-currency processing services. The Company operates through two segments: multi-currency processing services and payment processing services. Its multi-currency processing services segment includes Pay In Your Currency, Multi-Currency Pricing and Dynamic Currency Conversion at automated teller machines, enable merchants to offer customized pricing in multiple currencies. Its payment processing services consist of end-to-end authorization, capture, clearing and settlement services to its customers along with localized language support and online access to reconciliation, reporting and analytics services. It provides its services to approximately 118,000 active merchant locations in over 20 countries and territories across the Asia Pacific region, the Americas, the Middle East, Africa and Europe, primarily through its acquiring bank and processor customers.

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