Head-To-Head Analysis: Mastercard (NYSE:MA) and Usio (NASDAQ:USIO)

Mastercard (NYSE:MA) and Usio (NASDAQ:USIO) are both business services companies, but which is the better business? We will compare the two businesses based on the strength of their dividends, profitability, valuation, analyst recommendations, institutional ownership, earnings and risk.

Analyst Recommendations

This is a breakdown of current recommendations for Mastercard and Usio, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Mastercard	0	3	21	5	3.07
Usio	2	0	1	0	1.67

Mastercard currently has a consensus price target of $657.48, suggesting a potential upside of 13.43%. Usio has a consensus price target of $4.00, suggesting a potential upside of 200.75%. Given Usio’s higher probable upside, analysts plainly believe Usio is more favorable than Mastercard.

Profitability

This table compares Mastercard and Usio’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Mastercard	45.28%	202.03%	29.11%
Usio	-0.46%	-2.05%	-0.37%

Valuation and Earnings

This table compares Mastercard and Usio”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Mastercard	$28.17 billion	18.48	$12.87 billion	$15.64	37.06
Usio	$82.93 million	0.44	$3.31 million	($0.02)	-66.50

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

Institutional & Insider Ownership

97.3% of Mastercard shares are owned by institutional investors. Comparatively, 20.2% of Usio shares are owned by institutional investors. 0.1% of Mastercard shares are owned by company insiders. Comparatively, 17.8% of Usio shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Risk and Volatility

Mastercard has a beta of 0.87, indicating that its share price is 13% less volatile than the S&P 500. Comparatively, Usio has a beta of 1.41, indicating that its share price is 41% more volatile than the S&P 500.

Summary

Mastercard beats Usio on 12 of the 15 factors compared between the two stocks.

About Mastercard

Mastercard Incorporated, a technology company, provides transaction processing and other payment-related products and services in the United States and internationally. The company offers integrated products and value-added services for account holders, merchants, financial institutions, digital partners, businesses, governments, and other organizations, such as programs that enable issuers to provide consumers with credits to defer payments; payment products and solutions that allow its customers to access funds in deposit and other accounts; prepaid programs services; and commercial credit, debit, and prepaid payment products and solutions. It also provides solutions that enable businesses or governments to make payments to businesses, including Virtual Card Number, which is generated dynamically from a physical card and leverages the credit limit of the funding account; a platform to optimize supplier payment enablement campaigns for financial institutions; and treasury intelligence platform that offers corporations with recommendations to enhance working capital performance and accelerate spend on cards. In addition, the company offers Mastercard Send, which partners with digital messaging and payment platforms to enable consumers to send money directly within applications to other consumers; and Mastercard Cross-Border Services enables a range of payment flows through a distribution network with a single point of access to send and receive money globally through various channels, including bank accounts, mobile wallets, cards, and cash payouts. Further, it provides cyber and intelligence solutions; insights and analytics, consulting, marketing, loyalty, processing, and payment gateway solutions for e-commerce merchants; and open banking and digital identity services. The company offers payment solutions and services under the MasterCard, Maestro, and Cirrus name. Mastercard Incorporated was founded in 1966 and is headquartered in Purchase, New York.

About Usio

Usio, Inc., together with its subsidiaries, provides integrated electronic payment processing services to merchants and businesses in the United States. The company offers various types of automated clearing house (ACH) processing; and credit, prepaid card, and debit card-based processing services. Its ACH transaction processing services include Represented Check and Check Conversion for electronic payment facilitation. In addition, the company offers merchant account services for the processing of card-based transactions through the VISA, MasterCard, American Express, Discover, and JCB networks, including online terminal services accessed through a website or retail services accessed through a physical terminal. Further, it provides a proprietary web-based customer service application that allows companies to process one-time and recurring payments through e-checks or credit cards; and an interactive voice response telephone system to companies, which accept payments directly from consumers over the telephone using e-checks or credit cards. Additionally, the company offers prepaid and incentive card issuance services; and operates a prepaid core processing platform, as well as provides additional services, such as electronic bill presentment, document composition, document decomposition, and printing and mailing services for various industry verticals, including utilities and financial institutions. It markets and sells ACH products and services primarily through resellers; and prepaid card program directly to government entities, corporations, and to consumers through the internet. The company was formerly known as Payment Data Systems, Inc. and changed its name to Usio, Inc. in June 2019. Usio, Inc. was incorporated in 1998 and is headquartered in San Antonio, Texas.