Global Payments (NYSE:GPN) and UWM (NYSE:UWMC) Head-To-Head Contrast

UWM (NYSE:UWMC) and Global Payments (NYSE:GPN) are both finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their earnings, analyst recommendations, dividends, institutional ownership, valuation, risk and profitability.

Profitability

This table compares UWM and Global Payments’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
UWM	-1.04%	-6.20%	-0.50%
Global Payments	-9.16%	13.80%	5.73%

Dividends

UWM pays an annual dividend of $0.40 per share and has a dividend yield of 35.6%. Global Payments pays an annual dividend of $1.00 per share and has a dividend yield of 1.2%. UWM pays out -500.0% of its earnings in the form of a dividend. Global Payments pays out -33.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. UWM is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a summary of recent recommendations and price targets for UWM and Global Payments, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
UWM	2	7	5	0	2.21
Global Payments	3	17	10	0	2.23

UWM currently has a consensus price target of $3.90, indicating a potential upside of 246.67%. Global Payments has a consensus price target of $94.48, indicating a potential upside of 16.38%. Given UWM’s higher probable upside, research analysts clearly believe UWM is more favorable than Global Payments.

Volatility and Risk

UWM has a beta of 1.82, suggesting that its stock price is 82% more volatile than the S&P 500. Comparatively, Global Payments has a beta of 0.8, suggesting that its stock price is 20% less volatile than the S&P 500.

Valuation & Earnings

This table compares UWM and Global Payments”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
UWM	$3.16 billion	0.57	$27.38 million	($0.08)	-14.06
Global Payments	$7.71 billion	2.79	$1.40 billion	($2.98)	-27.24

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

Insider & Institutional Ownership

53.6% of UWM shares are held by institutional investors. Comparatively, 89.8% of Global Payments shares are held by institutional investors. 80.9% of UWM shares are held by insiders. Comparatively, 0.6% of Global Payments shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

About UWM

UWM Holdings Corporation engages in the residential mortgage lending business in the United States. The company offers mortgage loans through wholesale channel. It originates primarily conforming and government loans. UWM Holdings Corporation was founded in 1986 and is headquartered in Pontiac, Michigan.

About Global Payments

Global Payments Inc. provides payment technology and software solutions for card, check, and digital-based payments in the Americas, Europe, and the Asia-Pacific. It operates through two segments, Merchant Solutions and Issuer Solutions. The Merchant Solutions segment offers authorization, settlement and funding, customer support, chargeback resolution, terminal rental, sales and deployment, payment security, and consolidated billing and reporting services. This segment also provides an array of enterprise software solutions that streamline business operations of its customers in various vertical markets; and value-added solutions and services, such as point-of-sale software, analytics and customer engagement, payroll and reporting, and human capital management. The Issuer Solutions segment offers solutions that enable financial institutions and retailers to manage their card portfolios through a platform; and commercial payments, account payables, and electronic payment alternatives solutions for businesses and governments. It markets its products and services through direct sales force, trade associations, agent and enterprise software providers, referral arrangements with value-added resellers, and independent sales organizations. The company was founded in 1967 and is headquartered in Atlanta, Georgia.