Critical Comparison: Worldline (OTCMKTS:WWLNF) vs. Evertec (NYSE:EVTC)

Evertec (NYSE:EVTC) and Worldline (OTCMKTS:WWLNF) are both small-cap business services companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, dividends, profitability, risk, earnings, analyst recommendations and institutional ownership.

Institutional and Insider Ownership

96.8% of Evertec shares are held by institutional investors. 1.1% of Evertec shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Evertec and Worldline, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Evertec	0	5	2	0	2.29
Worldline	1	1	0	0	1.50

Evertec currently has a consensus target price of $35.80, indicating a potential upside of 21.85%. Given Evertec’s stronger consensus rating and higher probable upside, analysts clearly believe Evertec is more favorable than Worldline.

Profitability

This table compares Evertec and Worldline’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Evertec	15.19%	33.27%	9.86%
Worldline	N/A	N/A	N/A

Earnings and Valuation

This table compares Evertec and Worldline”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Evertec	$931.82 million	1.94	$141.59 million	$2.19	13.42
Worldline	$4.56 billion	0.02	-$5.83 billion	N/A	N/A

Evertec has higher earnings, but lower revenue than Worldline.

Risk & Volatility

Evertec has a beta of 0.84, suggesting that its stock price is 16% less volatile than the S&P 500. Comparatively, Worldline has a beta of 1.09, suggesting that its stock price is 9% more volatile than the S&P 500.

Summary

Evertec beats Worldline on 10 of the 12 factors compared between the two stocks.

About Evertec

EVERTEC, Inc. engages in transaction processing business and financial technology in Latin America and the Caribbean. The company operates through four segments: Payment Services – Puerto Rico & Caribbean; Latin America Payments and Solutions; Merchant Acquiring; and Business Solutions. It provides merchant acquiring services, which enable point of sales and e-commerce merchants to accept and process electronic methods of payment, such as debit, credit, prepaid, and electronic benefit transfer (EBT) cards. In addition, the company offers payment processing services that enable financial institutions and other issuers to manage, support, and facilitate the processing for credit, debit, prepaid, automated teller machines, and EBT card programs; credit and debit card processing, authorization and settlement, and fraud monitoring and control services to debit or credit issuers services. Further, it provides business process management solutions comprising core bank processing, network hosting and management, IT professional, business process outsourcing, item and cash processing, and fulfillment solutions to merchant, fintech, financial institutions, and corporate and government customers. Additionally, the company owns and operates the ATH network, a personal identification number debit networks. It manages a system of electronic payment networks that process approximately six billion transactions. The company sells and distributes its services primarily through direct sales force. It serves financial institutions, merchants, corporations, and government agencies. EVERTEC, Inc. was founded in 1988 and is headquartered in San Juan, Puerto Rico.

About Worldline

Worldline SA provides payments and transactional services to financial institutions, merchants, corporations, and government agencies in Northern Europe, Central and Eastern Europe, Southern Europe, and internationally. The company operates through Merchant Services; Financial Services; and Mobility & e-Transactional Services segments. The Merchant Services segment offers commercial acquiring, terminal, omnichannel payment acceptance, and digital retail services. The Financial Services segment provides issuing processing, acquiring processing, digital banking, and account payments services. The Mobility & e-Transactional Services segment offers trusted digitization, e-ticketing, and e-consumer and mobility. The company was formerly known as Atos Worldline S.A.S. and changed its name to Worldline SA in April 2014. Worldline SA was founded in 1973 and is headquartered in Puteaux, France.