Openlane (NYSE:OPLN) and Deluxe (NYSE:DLX) Critical Analysis

Openlane (NYSE:OPLN) and Deluxe (NYSE:DLX) are both industrials companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, earnings, dividends, analyst recommendations, risk, valuation and institutional ownership.

Insider and Institutional Ownership

99.8% of Openlane shares are held by institutional investors. Comparatively, 93.9% of Deluxe shares are held by institutional investors. 2.2% of Openlane shares are held by insiders. Comparatively, 5.4% of Deluxe shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Risk & Volatility

Openlane has a beta of 1.28, suggesting that its share price is 28% more volatile than the S&P 500. Comparatively, Deluxe has a beta of 1.25, suggesting that its share price is 25% more volatile than the S&P 500.

Earnings and Valuation

This table compares Openlane and Deluxe”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Openlane	$1.93 billion	2.21	$177.70 million	($0.85)	-40.95
Deluxe	$2.13 billion	0.48	$82.10 million	$2.25	9.95

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

Analyst Recommendations

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

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Openlane	0	3	4	0	2.57
Deluxe	0	3	0	1	2.50

Openlane currently has a consensus price target of $43.83, suggesting a potential upside of 25.93%. Deluxe has a consensus price target of $31.00, suggesting a potential upside of 38.52%. Given Deluxe’s higher probable upside, analysts plainly believe Deluxe is more favorable than Openlane.

Profitability

This table compares Openlane and Deluxe’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Openlane	9.67%	12.81%	3.62%
Deluxe	4.91%	23.51%	6.12%

Summary

Deluxe beats Openlane on 8 of the 15 factors compared between the two stocks.

About Openlane

OPENLANE Inc. provides sellers and buyers across the wholesale used vehicle industry with technology-driven remarketing solutions. The company’s end-to-end platform supports whole car, financing, logistics and other ancillary and related services. OPENLANE Inc., formerly known as KAR Auction Services Inc., is based in CARMEL, Ind.

About Deluxe

Deluxe Corporation provides technology-enabled solutions to enterprises, small businesses, and financial institutions in the United States, Canada, and Australia. It operates through Merchant Services, B2B Payments, Data Solutions, and Print segments. The Merchant Services offers credit and debit card authorization and payment systems, as well as processing services primarily to small and medium-sized retail and service businesses. The B2B Payments segment provides treasury management solutions, including remittance and lockbox processing, remote deposit capture, automated receivables management, payment processing, and cash application, as well as automated payables management, such as medical payment and deluxe payment exchange. The Data solutions segment offers data-driven marketing solutions, financial institution profitability reporting, and business incorporation services. The Print segment provides printed personal and business checks, printed business forms, business accessories, and promotional products. It sells through multi-channel sales and marketing, and scalable partnerships. The company was formerly known as Deluxe Check Printers, Incorporated and changed its name to Deluxe Corporation in 1988. Deluxe Corporation was founded in 1915 and is headquartered in Minneapolis, Minnesota.