Critical Analysis: Cass Information Systems (CASS) vs. Its Competitors

Cass Information Systems (NASDAQ: CASS) is one of 30 publicly-traded companies in the “Transaction & Payment Services” industry, but how does it weigh in compared to its rivals? We will compare Cass Information Systems to related companies based on the strength of its analyst recommendations, earnings, risk, institutional ownership, profitability, dividends and valuation.

Volatility & Risk

Cass Information Systems has a beta of 1.26, meaning that its share price is 26% more volatile than the S&P 500. Comparatively, Cass Information Systems’ rivals have a beta of 1.26, meaning that their average share price is 26% more volatile than the S&P 500.

Insider and Institutional Ownership

47.4% of Cass Information Systems shares are owned by institutional investors. Comparatively, 58.3% of shares of all “Transaction & Payment Services” companies are owned by institutional investors. 5.0% of Cass Information Systems shares are owned by insiders. Comparatively, 19.9% of shares of all “Transaction & Payment Services” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Cass Information Systems and its rivals, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cass Information Systems 0 0 0 0 N/A
Cass Information Systems Competitors 148 761 1099 17 2.49

As a group, “Transaction & Payment Services” companies have a potential upside of 11.83%. Given Cass Information Systems’ rivals higher probable upside, analysts clearly believe Cass Information Systems has less favorable growth aspects than its rivals.

Valuation and Earnings

This table compares Cass Information Systems and its rivals gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Cass Information Systems $135.30 million $25.01 million 28.51
Cass Information Systems Competitors $2.28 billion $225.84 million 845.95

Cass Information Systems’ rivals have higher revenue and earnings than Cass Information Systems. Cass Information Systems is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Dividends

Cass Information Systems pays an annual dividend of $0.96 per share and has a dividend yield of 1.7%. Cass Information Systems pays out 47.5% of its earnings in the form of a dividend. As a group, “Transaction & Payment Services” companies pay a dividend yield of 1.4% and pay out 49.5% of their earnings in the form of a dividend. Cass Information Systems has raised its dividend for 13 consecutive years. Cass Information Systems is clearly a better dividend stock than its rivals, given its higher yield and lower payout ratio.

Profitability

This table compares Cass Information Systems and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Cass Information Systems 18.49% 12.22% 1.75%
Cass Information Systems Competitors 7.46% 10.74% 3.59%

Summary

Cass Information Systems rivals beat Cass Information Systems on 7 of the 12 factors compared.

Cass Information Systems Company Profile

Cass Information Systems, Inc. (Cass) is a provider of payment and information processing services to manufacturing, distribution and retail enterprises across the United States with operating locations in Missouri, Ohio, Massachusetts, South Carolina and Florida. The Company provides transportation invoice rating, payment processing, auditing, accounting and transportation information. It is also a processor and payer of energy invoices, including electricity, gas, waste, and other facility related expenses. The Company operates in two segments: Information Services and Banking Services. The Information Services segment provides transportation, energy, telecommunication, and environmental invoice processing and payment services to large corporations. The Banking Services segment provides banking services primarily to privately held businesses and churches. The Company, through its bank subsidiary, Cass Commercial Bank (the Bank), provides commercial banking services.

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