Contrasting Priority Technology (NASDAQ:PRTH) and WEX (NYSE:WEX)

WEX (NYSE:WEX) and Priority Technology (NASDAQ:PRTH) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their risk, profitability, earnings, dividends, institutional ownership, analyst recommendations and valuation.

Profitability

This table compares WEX and Priority Technology’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
WEX	12.56%	43.19%	3.53%
Priority Technology	5.61%	-104.91%	3.87%

Insider and Institutional Ownership

97.5% of WEX shares are owned by institutional investors. Comparatively, 11.5% of Priority Technology shares are owned by institutional investors. 1.4% of WEX shares are owned by company insiders. Comparatively, 59.4% of Priority Technology shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Volatility and Risk

WEX has a beta of 0.84, meaning that its share price is 16% less volatile than the S&P 500. Comparatively, Priority Technology has a beta of 1.58, meaning that its share price is 58% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings for WEX and Priority Technology, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
WEX	0	8	6	0	2.43
Priority Technology	0	6	2	0	2.25

WEX currently has a consensus price target of $185.64, suggesting a potential upside of 9.41%. Priority Technology has a consensus price target of $8.59, suggesting a potential upside of 10.36%. Given Priority Technology’s higher possible upside, analysts plainly believe Priority Technology is more favorable than WEX.

Valuation & Earnings

This table compares WEX and Priority Technology”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
WEX	$2.66 billion	2.17	$304.10 million	$10.04	16.90
Priority Technology	$953.01 million	0.67	$55.68 million	$0.69	11.28

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

Summary

WEX beats Priority Technology on 10 of the 14 factors compared between the two stocks.

About WEX

WEX Inc. operates a commerce platform in the United States and internationally. The Mobility segment offers fleet vehicle payment solutions, transaction processing, and information management services; and provides account activation and account retention services; authorization and billing inquiries, and account maintenance services; account management; credit and collections services; merchant services; analytics solutions; and ancillary services and offerings. This segment markets its products directly and indirectly to businesses and government agencies with fleets of commercial vehicles; and indirectly through co-branded and private label relationships. The Corporate Payments segment provides payment solutions, including embedded payments; and accounts payable automation and spend management solutions. This segment also markets its products directly and indirectly to customers in travel, fintech, insurance, consumer bill pay, and media verticals. The Benefits Solutions segment offers software-as-a-service (SaaS) platform for consumer directed healthcare benefits and full-service benefit enrollment solutions. In addition, its SaaS platform includes embedded payment solutions and plan administration services for consumer-directed health benefits; COBRA accounts; and benefit enrollment and administration services. Further, it offers custodial and depository services for health savings accounts; and markets its products through third-party administrators, financial institutions, payroll providers, and health plans. The company was formerly known as Wright Express Corporation and changed its name to WEX Inc. in October 2012. WEX Inc. was founded in 1983 and is based in Portland, Maine.

About Priority Technology

Priority Technology Holdings, Inc. operates as a payment technology company in the United States. The company operates through three segments: Small and Medium-Sized Businesses (SMB) Payments, Business-To-Business (B2B) Payments, and Enterprise Payments. It offers SMB payments processing solutions for B2C transactions through independent sales organizations, financial institutions, independent software vendors, and other referral partners through its MX product suite, which includes MX Connect and MX Merchant products, such as MX Insights, MX Storefront, MX Retail, MX Invoice, MX B2B and ACH.com, and others, which provides flexible and customizable set of business applications that helps to manage critical business work functions and revenue performance to resellers and merchant clients using core payment processing. The company also offers CPX, a platform that offers accounts payable automation solutions, including virtual card, purchase card, ACH +, dynamic discounting, or check. In addition, it provides curated managed services; payment-adjacent technologies to facilitate the acceptance of electronic payments from customers; and Plastiq payables management software, which helps businesses in improving cash flow with instant access to working capital. Further, the company offers embedded finance and BaaS solutions to enterprise customers to modernize legacy platforms and accelerate software partners' strategies to monetize payments; and managed services solutions that provide audience-specific programs for institutional partners and other third parties; and consulting and development solutions. It serves SMB, and enterprises, as well as distribution partners, including retail and wholesale independent sales organizations, financial institutions, and independent software vendors. The company was founded in 2005 and is headquartered in Alpharetta, Georgia.