Reviewing Paymentus (NYSE:PAY) and Block (NYSE:XYZ)

Paymentus (NYSE:PAY) and Block (NYSE:XYZ) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, valuation, earnings, profitability, institutional ownership, risk and dividends.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Paymentus and Block, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Paymentus	0	4	3	2	2.78
Block	0	9	29	3	2.85

Paymentus presently has a consensus target price of $38.86, suggesting a potential upside of 18.68%. Block has a consensus target price of $95.61, suggesting a potential upside of 25.21%. Given Block’s stronger consensus rating and higher possible upside, analysts plainly believe Block is more favorable than Paymentus.

Institutional & Insider Ownership

78.4% of Paymentus shares are owned by institutional investors. Comparatively, 70.4% of Block shares are owned by institutional investors. 55.7% of Paymentus shares are owned by insiders. Comparatively, 11.4% of Block shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Paymentus and Block’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Paymentus	6.24%	15.26%	12.80%
Block	1.43%	8.10%	4.53%

Volatility & Risk

Paymentus has a beta of 1.34, indicating that its share price is 34% more volatile than the S&P 500. Comparatively, Block has a beta of 2.55, indicating that its share price is 155% more volatile than the S&P 500.

Earnings & Valuation

This table compares Paymentus and Block”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Paymentus	$1.20 billion	3.45	$66.94 million	$0.66	49.61
Block	$24.19 billion	1.90	$1.31 billion	$0.56	136.37

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

Summary

Block beats Paymentus on 8 of the 15 factors compared between the two stocks.

About Paymentus

Paymentus Holdings, Inc. provides cloud-based bill payment technology and solutions in the United States and internationally. The company offers electronic bill presentment and payment services, enterprise customer communication, and self-service revenue management to billers through a software-as-a-service technology platform. Its platform's payment processing includes credit cards, debit cards, eChecks, and digital wallets. It serves utility, financial service, government, insurance, telecommunication, real estate management, education, consumer finance, healthcare, and small business industries. The company was founded in 2004 and is headquartered in Charlotte, North Carolina.

About Block

Square, Inc. provides payment and point-of-sale solutions in the United States and internationally. The company's commerce ecosystem includes point-of-sale software and hardware that enables sellers to turn mobile and computing devices into payment and point-of-sale solutions. It offers hardware products, including Magstripe reader, which enables swiped transactions of magnetic stripe cards; Contactless and chip reader that accepts EMV® chip cards and Near Field Communication payments; Chip card reader, which accepts EMV® chip cards and enables swiped transactions of magnetic stripe cards; Square Stand, which enables an iPad to be used as a payment terminal or full point of sale solution; and Square Register that combines its hardware, point-of-sale software, and payments technology, as well as managed payments solutions. The company also provides Square Point of Sale software; Cash App, which provides access to the financial system, allowing customers to electronically send, store, and spend money; Caviar, a food ordering platform for restaurants to offer food ordering, pickup and delivery, to their customers; and Square Capital that facilitates loans to sellers based on real-time payment and point-of-sale data. Square, Inc. was founded in 2009 and is headquartered in San Francisco, California.