Analyzing Qiwi Plc (QIWI) & Net 1 UEPS Technologies (NASDAQ:UEPS)

Qiwi Plc (NASDAQ: QIWI) and Net 1 UEPS Technologies (NASDAQ:UEPS) are both small-cap business services companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, valuation, profitability, analyst recommendations, dividends, institutional ownership and risk.

Risk and Volatility

Qiwi Plc has a beta of 3.34, suggesting that its stock price is 234% more volatile than the S&P 500. Comparatively, Net 1 UEPS Technologies has a beta of 0.77, suggesting that its stock price is 23% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Qiwi Plc and Net 1 UEPS Technologies, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Qiwi Plc 0 2 2 0 2.50
Net 1 UEPS Technologies 0 0 0 0 N/A

Qiwi Plc presently has a consensus price target of $22.67, suggesting a potential upside of 29.30%. Given Qiwi Plc’s higher probable upside, equities analysts plainly believe Qiwi Plc is more favorable than Net 1 UEPS Technologies.

Dividends

Qiwi Plc pays an annual dividend of $0.76 per share and has a dividend yield of 4.3%. Net 1 UEPS Technologies does not pay a dividend. Qiwi Plc pays out 101.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Profitability

This table compares Qiwi Plc and Net 1 UEPS Technologies’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Qiwi Plc 14.88% 22.31% 12.32%
Net 1 UEPS Technologies 14.19% 15.31% 7.86%

Institutional and Insider Ownership

16.8% of Qiwi Plc shares are owned by institutional investors. Comparatively, 56.9% of Net 1 UEPS Technologies shares are owned by institutional investors. 6.3% of Net 1 UEPS Technologies shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Qiwi Plc and Net 1 UEPS Technologies’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Qiwi Plc N/A N/A N/A $0.75 23.37
Net 1 UEPS Technologies $606.27 million 0.89 $156.03 million $1.63 5.81

Net 1 UEPS Technologies has higher revenue and earnings than Qiwi Plc. Net 1 UEPS Technologies is trading at a lower price-to-earnings ratio than Qiwi Plc, indicating that it is currently the more affordable of the two stocks.

Summary

Qiwi Plc beats Net 1 UEPS Technologies on 8 of the 13 factors compared between the two stocks.

About Qiwi Plc

QIWI plc is a provider of payment services in Russia and the Commonwealth of Independent States (CIS). The Company’s network enables payment services across physical, online and mobile channels. The Company operates in target markets and customer segments. As of December 31, 2016, the Company had deployed over 17.2 million virtual wallets, over 162,000 kiosks and terminals, and enabled merchants to accept over Russian rubles 70 billion cash and electronic payments monthly. The Company’s consumers can use cash, stored value and other electronic payment methods to order and pay for goods and services across physical or virtual environments interchangeably. The Company provides integrated network of physical distribution points and virtual wallets, as well as payment channels and methods that enable consumers to deposit cash, convert it into a digital form and transfer the funds to a virtual wallet or pay for any merchant in its network.

About Net 1 UEPS Technologies

Net 1 UEPS Technologies, Inc. is a provider of payment solutions, transaction processing services and financial technology across multiple industries. The Company develops and markets a transaction processing solution that encompasses its smart card-based alternative payment system for the unbanked and under-banked populations of developing economies and for mobile transaction channels. The Company operates through three segments: South African transaction processing, International transaction processing, and Financial inclusion and applied technologies. The Company also provides secure transaction technology solutions and services, by offering transaction processing, financial and clinical risk management solutions to various industries. It offers secure online transaction processing, cryptography, mobile telephony, integrated circuit card (chip/smart card) technologies, and the design and provision of financial and value-added services to its cardholder base.

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