Reviewing Orix Corp Ads (NYSE:IX) and PagSeguro Digital (NYSE:PAGS)

Orix Corp Ads (NYSE:IX) and PagSeguro Digital (NYSE:PAGS) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, risk, valuation, analyst recommendations, earnings, institutional ownership and profitability.

Risk and Volatility

Orix Corp Ads has a beta of 0.9, suggesting that its share price is 10% less volatile than the S&P 500. Comparatively, PagSeguro Digital has a beta of 1.27, suggesting that its share price is 27% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and recommmendations for Orix Corp Ads and PagSeguro Digital, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Orix Corp Ads	0	1	1	0	2.50
PagSeguro Digital	1	4	2	0	2.14

PagSeguro Digital has a consensus price target of $11.08, suggesting a potential downside of 0.11%. Given PagSeguro Digital’s higher possible upside, analysts plainly believe PagSeguro Digital is more favorable than Orix Corp Ads.

Dividends

Orix Corp Ads pays an annual dividend of $0.58 per share and has a dividend yield of 1.6%. PagSeguro Digital pays an annual dividend of $1.12 per share and has a dividend yield of 10.1%. Orix Corp Ads pays out 16.0% of its earnings in the form of a dividend. PagSeguro Digital pays out 78.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Valuation & Earnings

This table compares Orix Corp Ads and PagSeguro Digital”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Orix Corp Ads	$2,286.38 billion	0.02	$2.95 billion	$3.62	10.10
PagSeguro Digital	$3.65 billion	0.85	$379.40 million	$1.43	7.76

Orix Corp Ads has higher revenue and earnings than PagSeguro Digital. PagSeguro Digital is trading at a lower price-to-earnings ratio than Orix Corp Ads, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

1.7% of Orix Corp Ads shares are owned by institutional investors. Comparatively, 45.9% of PagSeguro Digital shares are owned by institutional investors. 0.1% of Orix Corp Ads shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares Orix Corp Ads and PagSeguro Digital’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Orix Corp Ads	18.02%	13.11%	3.38%
PagSeguro Digital	10.46%	16.36%	3.25%

Summary

Orix Corp Ads beats PagSeguro Digital on 9 of the 16 factors compared between the two stocks.

About Orix Corp Ads

ORIX Corporation provides diversified financial services in Japan, the United States, Asia, Europe, Australasia, and the Middle East. The company's Corporate Financial Services and Maintenance Leasing segment is involved in the finance and fee; leasing and rental of automobiles, electronic measuring instruments, and ICT-related equipment businesses; and provision of life insurance and environment and energy-related products and services. Its Real Estate segment develops, rents, and manages real estate properties; operates facilities; real estate asset management; manages residential condominiums and office building; and provides construction contracting, real estate brokerage, and real estate investment advisory services, as well as operates hotels and Japanese inns. The company's PE Investment and Concession segment engages in the private equity (PE) investment and concession businesses. Its Environment and Energy segment provides renewable energy; ESCO; retails electric power; sells solar panels and battery electricity storage systems; and recycling and waste management services, as well as generates solar power. The company's Insurance segment sells life insurance products through agents, banks, and other financial institutions, as well as face-to-face and online. Its Banking and Credit segment provides banking and consumer finance services. The company's Aircraft and Ships segment engages in the aircraft leasing and management, and ship-related finance and investment businesses. Its ORIX USA segment offers finance, investment, and asset management services. The company's ORIX Europe segment provides equity and fixed income asset management services. Its Asia and Australia segment offers finance and investment businesses. The company was formerly known as Orient Leasing Co., Ltd. and changed its name to ORIX Corporation in 1989. ORIX Corporation was incorporated in 1950 and is headquartered in Tokyo, Japan.

About PagSeguro Digital

PagSeguro Digital Ltd., together with its subsidiaries, provides financial technology solutions and services for consumers, individual entrepreneurs, micro-merchants, and small and medium-sized companies in Brazil and internationally. The company's products and services include PagSeguro Ecosystem, a digital ecosystem that operates as a closed loop where its clients are able to address their primary day to day financial needs, including receiving and spending funds, and managing and growing their businesses; PagBank digital account, which offers payment and banking services through the PagBank mobile app, as well as centralizes various cash-in options, functionalities, services, and cash-out options in a single ecosystem; and PlugPag, a tool for medium-sized and larger merchants that enables them to connect their point of sale (POS) device directly to their enterprise resource planning software or sales automation system through Bluetooth. It also offers cash-in solutions; online and in-person payment tools; and online gaming and cross-border digital services, as well as issues prepaid, credit, and cash cards. In addition, the company provides functionalities, and value-added services and features, such as purchase protection mechanisms, antifraud platform, account and business management tools, POS app, i-Banking App, Super App, and e-commerce support and bill payment services; and PedeFácil, an order management and food delivery app. Further, it is involved in processing of back-office solutions, including sales reconciliation, and gateway solutions and services, as well as the capture of credit cards with acquirers and sub acquirers. The company was founded in 2006 and is headquartered in São Paulo, Brazil.