Evertec (EVTC) and The Competition Critical Contrast

Evertec (NYSE:EVTC) is one of 340 public companies in the “Financial Services” industry, but how does it compare to its competitors? We will compare Evertec to related businesses based on the strength of its profitability, analyst recommendations, institutional ownership, earnings, valuation, dividends and risk.

Profitability

This table compares Evertec and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Evertec	9.00%	32.81%	8.93%
Evertec Competitors	-276.94%	-40.55%	-5.83%

Institutional & Insider Ownership

96.8% of Evertec shares are owned by institutional investors. Comparatively, 43.0% of shares of all “Financial Services” companies are owned by institutional investors. 1.1% of Evertec shares are owned by company insiders. Comparatively, 21.7% of shares of all “Financial Services” companies are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Dividends

Evertec pays an annual dividend of $0.20 per share and has a dividend yield of 0.6%. Evertec pays out 13.2% of its earnings in the form of a dividend. As a group, “Financial Services” companies pay a dividend yield of 4.2% and pay out -72.0% of their earnings in the form of a dividend. Evertec lags its competitors as a dividend stock, given its lower dividend yield and higher payout ratio.

Volatility & Risk

Evertec has a beta of 0.71, suggesting that its share price is 29% less volatile than the S&P 500. Comparatively, Evertec’s competitors have a beta of 2.51, suggesting that their average share price is 151% more volatile than the S&P 500.

Earnings and Valuation

This table compares Evertec and its competitors top-line revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Evertec	$931.82 million	$141.59 million	21.39
Evertec Competitors	$6.41 billion	$1.10 billion	9.79

Evertec’s competitors have higher revenue and earnings than Evertec. Evertec is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Evertec and its competitors, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Evertec	0	3	2	0	2.40
Evertec Competitors	1986	6966	11751	446	2.50

Evertec presently has a consensus target price of $36.67, suggesting a potential upside of 12.76%. As a group, “Financial Services” companies have a potential downside of 4.62%. Given Evertec’s higher probable upside, equities research analysts clearly believe Evertec is more favorable than its competitors.

Summary

Evertec competitors beat Evertec on 10 of the 15 factors compared.

Evertec Company Profile

Evertec, Inc. is a financial technology company headquartered in San Juan, Puerto Rico. It provides payment processing and related technology services to financial institutions, merchants, businesses and government agencies across Latin America and the Caribbean, as well as in the United States. The company’s services include merchant acquiring, debit and credit card processing, electronic payments and business process management. Its technology offerings also support financial institutions’ operations, while its ATH network and ATH Móvil platform facilitate electronic payments in Puerto Rico.