Head-To-Head Survey: Western Union Company (The) (WU) vs. Planet Payment (PLPM)
Western Union Company (The) (NYSE: WU) and Planet Payment (NASDAQ:PLPM) are both business services companies, but which is the superior stock? We will compare the two businesses based on the strength of their valuation, institutional ownership, profitabiliy, analyst recommendations, earnings, dividends and risk.
Volatility & Risk
Western Union Company (The) has a beta of 1.19, meaning that its stock price is 19% more volatile than the S&P 500. Comparatively, Planet Payment has a beta of 0.66, meaning that its stock price is 34% less volatile than the S&P 500.
Western Union Company (The) pays an annual dividend of $0.70 per share and has a dividend yield of 3.6%. Planet Payment does not pay a dividend. Western Union Company (The) pays out 179.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Planet Payment has raised its dividend for 2 consecutive years.
This table compares Western Union Company (The) and Planet Payment’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Western Union Company (The)||3.50%||92.41%||9.04%|
Institutional and Insider Ownership
53.2% of Planet Payment shares are owned by institutional investors. 1.1% of Western Union Company (The) shares are owned by insiders. Comparatively, 20.2% of Planet Payment shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
Valuation & Earnings
This table compares Western Union Company (The) and Planet Payment’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Western Union Company (The)||$5.43 billion||1.67||$1.36 billion||$0.39||49.49|
|Planet Payment||$53.38 million||2.90||$11.45 million||$0.45||7.04|
Western Union Company (The) has higher revenue and earnings than Planet Payment. Planet Payment is trading at a lower price-to-earnings ratio than Western Union Company (The), indicating that it is currently the more affordable of the two stocks.
This is a summary of current ratings and price targets for Western Union Company (The) and Planet Payment, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Western Union Company (The)||4||5||1||0||1.70|
Western Union Company (The) presently has a consensus target price of $20.22, indicating a potential upside of 4.78%. Given Western Union Company (The)’s higher probable upside, equities research analysts plainly believe Western Union Company (The) is more favorable than Planet Payment.
Planet Payment beats Western Union Company (The) on 9 of the 16 factors compared between the two stocks.
Western Union Company (The) Company Profile
The Western Union Company (Western Union) is a provider of money movement and payment services. The Company operates through three segments: Consumer-to-Consumer, Consumer-to-Business and Business Solutions. The Company’s Consumer-to-Consumer segment facilitates money transfers between two consumers, primarily through a network of third-party agents. The Company’s Consumer-to-Business segment provides options to make one-time or recurring payments from consumers to businesses and other organizations, including utilities, auto finance companies, mortgage servicers, financial service providers and government agencies. Its Consumer-to-Business payments services are available through a range of services that include Speedpay, Pago Facil and Western Union Payments. Western Union’s Business Solutions segment facilitates payment and foreign exchange solutions, primarily cross-border, cross-currency transactions, for small and medium size enterprises and other organizations and individuals.
Planet Payment Company Profile
Planet Payment, Inc. is a provider of international payment and transaction processing and multi-currency processing services. The Company operates through two segments: multi-currency processing services and payment processing services. Its multi-currency processing services segment includes Pay In Your Currency, Multi-Currency Pricing and Dynamic Currency Conversion at automated teller machines, enable merchants to offer customized pricing in multiple currencies. Its payment processing services consist of end-to-end authorization, capture, clearing and settlement services to its customers along with localized language support and online access to reconciliation, reporting and analytics services. It provides its services to approximately 118,000 active merchant locations in over 20 countries and territories across the Asia Pacific region, the Americas, the Middle East, Africa and Europe, primarily through its acquiring bank and processor customers.
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