Analyzing Cass Information Systems (CASS) and First Data (FDC)

Cass Information Systems (NASDAQ: CASS) and First Data (NYSE:FDC) are both computer and technology companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, profitability, valuation, risk, earnings, institutional ownership and dividends.

Risk & Volatility

Cass Information Systems has a beta of 1.26, meaning that its share price is 26% more volatile than the S&P 500. Comparatively, First Data has a beta of 1.46, meaning that its share price is 46% more volatile than the S&P 500.

Insider & Institutional Ownership

50.2% of Cass Information Systems shares are owned by institutional investors. Comparatively, 48.2% of First Data shares are owned by institutional investors. 5.0% of Cass Information Systems shares are owned by insiders. Comparatively, 6.3% of First Data shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Cass Information Systems and First Data, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cass Information Systems 0 0 0 0 N/A
First Data 0 5 21 0 2.81

First Data has a consensus price target of $20.25, indicating a potential upside of 31.15%. Given First Data’s higher probable upside, analysts plainly believe First Data is more favorable than Cass Information Systems.

Valuation & Earnings

This table compares Cass Information Systems and First Data’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Cass Information Systems $135.30 million 5.30 $25.01 million $2.02 28.89
First Data $12.05 billion 1.18 $1.47 billion $1.55 9.96

First Data has higher revenue and earnings than Cass Information Systems. First Data is trading at a lower price-to-earnings ratio than Cass Information Systems, indicating that it is currently the more affordable of the two stocks.

Dividends

Cass Information Systems pays an annual dividend of $0.96 per share and has a dividend yield of 1.6%. First Data does not pay a dividend. Cass Information Systems pays out 47.5% of its earnings in the form of a dividend. Cass Information Systems has raised its dividend for 13 consecutive years.

Profitability

This table compares Cass Information Systems and First Data’s 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%
First Data 12.16% 26.90% 3.30%

Summary

First Data beats Cass Information Systems on 9 of the 16 factors compared between the two stocks.

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.

First Data Company Profile

First Data Corporation is a provider of commerce-enabling technology and solutions for merchants, financial institutions and card issuers. The Company’s segments are Global Business Solutions (GBS), Global Financial Solutions (GFS), Network & Security Solutions (NSS), and Corporate. The GBS segment provides businesses of all sizes and types with a range of solutions at the point of sale, including merchant acquiring, e-commerce, mobile commerce, point-of-sale, and other business solutions. The GFS segment provides financial institutions, which include bank and non-bank issuers, such as retailers with card portfolios, with a range of solutions that enable them to offer financial products and solutions to their customers. The NSS segment provides a range of network solutions and security, risk and fraud management solutions to business and financial institution clients in its GBS and GFS segments, and to financial institutions, businesses, governments, processors and other clients.

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