UWM (NYSE:UWMC) vs. Global Payments (NYSE:GPN) Head-To-Head Analysis

UWM (NYSE:UWMC) and Global Payments (NYSE:GPN) are both finance companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, dividends, risk, analyst recommendations, profitability, valuation and earnings.

Profitability

This table compares UWM and Global Payments’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
UWM	-1.04%	-6.20%	-0.50%
Global Payments	-9.16%	13.80%	5.73%

Volatility & Risk

UWM has a beta of 1.82, indicating that its share price is 82% more volatile than the S&P 500. Comparatively, Global Payments has a beta of 0.8, indicating that its share price is 20% less volatile than the S&P 500.

Institutional and Insider Ownership

53.6% of UWM shares are owned by institutional investors. Comparatively, 89.8% of Global Payments shares are owned by institutional investors. 80.9% of UWM shares are owned by company insiders. Comparatively, 0.6% of Global Payments shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for UWM and Global Payments, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
UWM	2	6	6	0	2.29
Global Payments	3	17	10	0	2.23

UWM presently has a consensus target price of $4.01, indicating a potential upside of 209.93%. Global Payments has a consensus target price of $94.48, indicating a potential upside of 14.76%. Given UWM’s stronger consensus rating and higher possible upside, analysts plainly believe UWM is more favorable than Global Payments.

Dividends

UWM pays an annual dividend of $0.40 per share and has a dividend yield of 30.9%. Global Payments pays an annual dividend of $1.00 per share and has a dividend yield of 1.2%. UWM pays out -500.0% of its earnings in the form of a dividend. Global Payments pays out -33.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. UWM is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation and Earnings

This table compares UWM and Global Payments”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
UWM	$3.16 billion	0.66	$27.38 million	($0.08)	-16.19
Global Payments	$10.21 billion	2.13	$1.40 billion	($2.98)	-27.63

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

Summary

UWM beats Global Payments on 9 of the 16 factors compared between the two stocks.

About UWM

UWM Holdings Corporation engages in the residential mortgage lending business in the United States. The company offers mortgage loans through wholesale channel. It originates primarily conforming and government loans. UWM Holdings Corporation was founded in 1986 and is headquartered in Pontiac, Michigan.

About Global Payments

Global Payments Inc. provides payment technology and software solutions for card, check, and digital-based payments in the Americas, Europe, and the Asia-Pacific. It operates through two segments, Merchant Solutions and Issuer Solutions. The Merchant Solutions segment offers authorization, settlement and funding, customer support, chargeback resolution, terminal rental, sales and deployment, payment security, and consolidated billing and reporting services. This segment also provides an array of enterprise software solutions that streamline business operations of its customers in various vertical markets; and value-added solutions and services, such as point-of-sale software, analytics and customer engagement, payroll and reporting, and human capital management. The Issuer Solutions segment offers solutions that enable financial institutions and retailers to manage their card portfolios through a platform; and commercial payments, account payables, and electronic payment alternatives solutions for businesses and governments. It markets its products and services through direct sales force, trade associations, agent and enterprise software providers, referral arrangements with value-added resellers, and independent sales organizations. The company was founded in 1967 and is headquartered in Atlanta, Georgia.