Global Payments vs PayPal Which Is a Smarter Choice?

Global Payments and PayPal are two major players in the financial technology industry, both offering online payment services to businesses and consumers worldwide. Global Payments, a leading provider of payment technology and software solutions, has a strong presence in the traditional financial services sector. Meanwhile, PayPal, known for its user-friendly online payment platform, has seen significant growth in recent years due to the increasing demand for digital payment solutions. Investors looking to capitalize on the expanding digital economy may find both stocks appealing for their growth potential.

Global Payments or PayPal?

When comparing Global Payments and PayPal, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Global Payments and PayPal.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Global Payments has a dividend yield of 1.09%, while PayPal has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Global Payments reports a 5-year dividend growth of 90.37% year and a payout ratio of 18.71%. On the other hand, PayPal reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Global Payments P/E ratio at 21.29 and PayPal's P/E ratio at 20.86. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Global Payments P/B ratio is 1.27 while PayPal's P/B ratio is 4.58.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Global Payments has seen a 5-year revenue growth of 0.74%, while PayPal's is 1.07%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Global Payments's ROE at 6.04% and PayPal's ROE at 21.46%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $114.08 for Global Payments and $89.82 for PayPal. Over the past year, Global Payments's prices ranged from $91.60 to $141.78, with a yearly change of 54.78%. PayPal's prices fluctuated between $55.77 and $93.66, with a yearly change of 67.94%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.