Genpact (NYSE: G) and Cardtronics (NASDAQ:CATM) are both business services companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, valuation, risk, dividends, institutional ownership, profitability and analyst recommendations.

Dividends

Genpact pays an annual dividend of $0.24 per share and has a dividend yield of 0.7%. Cardtronics does not pay a dividend. Genpact pays out 17.4% of its earnings in the form of a dividend.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Genpact and Cardtronics, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Genpact 0 2 6 0 2.75
Cardtronics 1 2 1 0 2.00

Genpact currently has a consensus target price of $33.14, suggesting a potential downside of 3.60%. Cardtronics has a consensus target price of $32.00, suggesting a potential upside of 38.71%. Given Cardtronics’ higher probable upside, analysts clearly believe Cardtronics is more favorable than Genpact.

Profitability

This table compares Genpact and Cardtronics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Genpact 10.18% 23.86% 9.71%
Cardtronics -9.37% 29.32% 7.19%

Insider & Institutional Ownership

91.3% of Genpact shares are owned by institutional investors. 1.4% of Genpact shares are owned by company insiders. Comparatively, 1.2% of Cardtronics shares are owned 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 and Valuation

This table compares Genpact and Cardtronics’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Genpact $2.57 billion 2.58 $269.68 million $1.38 24.91
Cardtronics $1.27 billion 0.83 $87.99 million ($2.99) -7.72

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

Risk and Volatility

Genpact has a beta of 0.58, meaning that its stock price is 42% less volatile than the S&P 500. Comparatively, Cardtronics has a beta of 0.64, meaning that its stock price is 36% less volatile than the S&P 500.

Summary

Genpact beats Cardtronics on 12 of the 16 factors compared between the two stocks.

Genpact Company Profile

Genpact Limited is engaged in providing digitally powered business process management and services. The Company is also engaged in designing, transforming and running a combination of processes, as well as providing solutions that combine elements of its service offerings. The Company’s segments include Business process outsourcing and Information technology services. The Company offers various vertical activities, which include banking and financial services, capital markets, consumer product goods services, healthcare, infrastructure and manufacturing services, insurance and life sciences. In addition to these vertical activities, it also offers analytics and research, collections and customer services, consulting and transformation services, core industry operations services, enterprise application services, finance and accounting (F&A) services, information technology (IT) infrastructure management services, and supply chain and procurement services.

Cardtronics Company Profile

Cardtronics plc, formerly Cardtronics, Inc., provides automated consumer financial services through its network of automated teller machines (ATMS) and multi-function financial services kiosks. The Company’s operations consists of its North America, Europe, and Corporate & Other segments. Its ATM operations in the United States, Canada, Mexico and Puerto Rico are included in its North America segment. Its ATM operations in the United Kingdom, Ireland, Germany, Poland, Spain and i-design are included in its Europe segment. Its transaction processing operations, which service its North American and European operations, along with external customers, and the Company’s corporate general and administrative functions comprise the Corporate & Other segment. As of December 31, 2016, it provided services to approximately 203,000 ATMs throughout the United States (including the United States territory of Puerto Rico), the United Kingdom, Ireland, Germany, Poland, Spain, Canada and Mexico.

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