Fiserv (NASDAQ: FISV) and Moneygram International (NASDAQ:MGI) are both business services companies, but which is the better stock? We will compare the two businesses based on the strength of their profitabiliy, dividends, institutional ownership, risk, valuation, earnings and analyst recommendations.

Earnings & Valuation

This table compares Fiserv and Moneygram International’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Fiserv $5.59 billion 4.78 $1.76 billion $4.09 30.22
Moneygram International $1.63 billion 0.53 $218.00 million $0.48 33.02

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

Profitability

This table compares Fiserv and Moneygram International’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Fiserv 16.04% 41.79% 10.70%
Moneygram International 2.03% -13.99% 1.21%

Insider and Institutional Ownership

87.6% of Fiserv shares are owned by institutional investors. Comparatively, 89.7% of Moneygram International shares are owned by institutional investors. 1.8% of Fiserv shares are owned by company insiders. Comparatively, 49.5% of Moneygram International shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Volatility & Risk

Fiserv has a beta of 0.81, indicating that its share price is 19% less volatile than the S&P 500. Comparatively, Moneygram International has a beta of 1.92, indicating that its share price is 92% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and target prices for Fiserv and Moneygram International, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Fiserv 0 8 5 0 2.38
Moneygram International 1 5 0 0 1.83

Fiserv presently has a consensus target price of $126.27, suggesting a potential upside of 2.18%. Moneygram International has a consensus target price of $14.16, suggesting a potential downside of 10.66%. Given Fiserv’s stronger consensus rating and higher possible upside, research analysts plainly believe Fiserv is more favorable than Moneygram International.

Summary

Fiserv beats Moneygram International on 11 of the 14 factors compared between the two stocks.

About Fiserv

Fiserv, Inc. is a provider of financial services technology. The Company provides account processing systems; electronic payments processing products and services, such as electronic bill payments, transaction processing, account-to-account transfers, and person-to-person payments; Internet and mobile banking systems, and related services, including document and payment card production and distribution, and lending and risk management products and services. The Company operates through two segments: Payments and Industry Products and the Financial Institution Services. The Payments segment services include electronic bill payment and presentment services, Internet and mobile banking software and services, and other electronic payments software and services. The Financial segment provides account processing services, item processing and source capture services, loan origination and servicing products, cash management and consulting services, and other products and services.

About Moneygram International

MoneyGram International, Inc. (MoneyGram) is a global provider of money transfer services. The Company operates through two segments: Global Funds Transfer and Financial Paper Products. The Company offers its services under the MoneyGram brand. The Company’s Global Funds Transfer Segment provides money transfer services and bill payment services primarily to unbanked and underbanked consumers. The Financial Paper Products Segment provides money orders to consumers through its agents and financial institutions located across the United States and Puerto Rico. The Company’s offerings include money transfers, bill payment services, money order services and official check processing. The Company’s money transfer services enable its consumers to send and receive funds across the world through its global network of locations. The Company also offers Digital/Self-Service solutions, such as moneygram.com, mobile solutions, account deposit and kiosk-based services.

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