Head to Head Analysis: Rocket Companies (NYSE:RKT) vs. Visa (NYSE:V)

Visa (NYSE:V) and Rocket Companies (NYSE:RKT) are both large-cap finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, institutional ownership, dividends, earnings, profitability and risk.

Profitability

This table compares Visa and Rocket Companies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Visa	50.78%	67.68%	25.45%
Rocket Companies	4.70%	5.13%	1.88%

Volatility and Risk

Visa has a beta of 0.77, meaning that its share price is 23% less volatile than the S&P 500. Comparatively, Rocket Companies has a beta of 2.23, meaning that its share price is 123% more volatile than the S&P 500.

Institutional & Insider Ownership

82.2% of Visa shares are held by institutional investors. Comparatively, 4.6% of Rocket Companies shares are held by institutional investors. 0.1% of Visa shares are held by company insiders. Comparatively, 57.7% of Rocket Companies shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Visa and Rocket Companies”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Visa	$40.00 billion	16.06	$20.06 billion	$11.76	30.61
Rocket Companies	$6.70 billion	5.07	-$68.00 million	$0.14	85.56

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

Analyst Ratings

This is a breakdown of recent recommendations for Visa and Rocket Companies, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Visa	0	0	34	3	3.08
Rocket Companies	0	9	9	0	2.50

Visa presently has a consensus price target of $425.21, suggesting a potential upside of 18.13%. Rocket Companies has a consensus price target of $19.57, suggesting a potential upside of 63.38%. Given Rocket Companies’ higher probable upside, analysts clearly believe Rocket Companies is more favorable than Visa.

Summary

Visa beats Rocket Companies on 11 of the 15 factors compared between the two stocks.

About Visa

Visa Inc. operates as a payment technology company in the United States and internationally. The company operates VisaNet, a transaction processing network that enables authorization, clearing, and settlement of payment transactions. It also offers credit, debit, and prepaid card products; tap to pay, tokenization, and click to pay services; Visa Direct, a solution that facilitates the delivery of funds to eligible cards, deposit accounts, and digital wallets; Visa B2B Connect, a multilateral business-to-business cross-border payments network; Visa Cross-Border Solution, a cross-border consumer payments solution; and Visa DPS that provides a range of value-added services, including fraud mitigation, dispute management, data analytics, campaign management, a suite of digital solutions, and contact center services. The company also provides acceptance solutions, which include Cybersource that provides modular and value-added services for connecting merchants to payment processing; risk and identity solutions, such as Visa Advanced Authorization, Visa Secure, Visa Risk and Decision Manager, Visa Consumer Authentication Service, and payment-decisioning solutions for fraud prevention; and Visa Consulting and Analytics, a payment consulting advisory services. It provides its services under the Visa, Visa Electron, Interlink, V PAY, and PLUS brand names. The company serves merchants, financial institutions, and government entities. Visa Inc. was founded in 1958 and is headquartered in San Francisco, California.

About Rocket Companies

Rocket Companies, Inc., a fintech holding company, provides mortgage lending, title and settlement services, and other financial technology services in the United States and Canada. It operates through two segments, Direct to Consumer and Partner Network. The company’s solutions include Rocket Mortgage, a mortgage lender; Amrock that provides title insurance, property valuation, and settlement services; Rocket Homes, a home search platform and real estate agent referral network, which offers technology-enabled services to support the home buying and selling experience; and Rocket Loans, an online-based personal loans business. It also offers Core Digital Media, a online marketing platform in the mortgage and personal financial product sectors; Rocket Money, a personal finance app that helps clients manage every aspect of their financial lives; Lendesk, a software services company that provides a point of sale system for mortgage professionals and a loan origination system for private lenders; Rock Connections, a sales and support platform specializing in contact center services; and Rocket Innovation Studio that recruits and mentors top technology talent. In addition, the company originates, closes, sells, and services agency-conforming loans. Rocket Companies, Inc. was founded in 1985 and is headquartered in Detroit, Michigan. The company operates as a subsidiary of Rock Holdings Inc.