Critical Analysis: Cass Information Systems (CASS) & Xoom (XOOM)
Xoom (NASDAQ: XOOM) and Cass Information Systems (NASDAQ:CASS) are both industrials companies, but which is the better business? We will contrast the two companies based on the strength of their earnings, valuation, institutional ownership, risk, profitability, dividends and analyst recommendations.
Insider & Institutional Ownership
50.2% of Cass Information Systems shares are owned by institutional investors. 5.0% of Cass Information Systems shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
This is a breakdown of current ratings for Xoom and Cass Information Systems, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Cass Information Systems||0||0||0||0||N/A|
This table compares Xoom and Cass Information Systems’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Cass Information Systems||18.49%||12.22%||1.75%|
Earnings and Valuation
This table compares Xoom and Cass Information Systems’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Cass Information Systems||$135.30 million||5.33||$25.01 million||$1.87||31.40|
Cass Information Systems has higher revenue and earnings than Xoom. Xoom is trading at a lower price-to-earnings ratio than Cass Information Systems, indicating that it is currently the more affordable of the two stocks.
Cass Information Systems pays an annual dividend of $0.96 per share and has a dividend yield of 1.6%. Xoom does not pay a dividend. Cass Information Systems pays out 51.3% of its earnings in the form of a dividend. Xoom has increased its dividend for 13 consecutive years.
Cass Information Systems beats Xoom on 8 of the 10 factors compared between the two stocks.
Xoom Corporation (Xoom) is engaged in the digital consumer-to-consumer international money transfer business. The Company offers money transfer services from the United States to around 32 countries and its cross-border bill payment services from the United States to approximately five countries. Xoom’s solutions offer its customers a way to send money to, and pay bills for family and friends from any Internet-enabled location. The Company’s operating platform provides various solutions for transferring funds internationally, such as origination, funding, disbursement and transaction processing. The Company’s technology platform includes a customer interface which enables customers to send transactions from its Website, mobile Website or mobile application, using a computer, a tablet or a mobile phone; a risk management system; a transaction processing platform, and a disbursement integration platform. The Company provides its services under the XOOM brand.
About Cass Information Systems
Cass Information Systems, Inc. (Cass) is a provider of payment and information processing services to manufacturing, distribution and retail enterprises across the United States with operating locations in Missouri, Ohio, Massachusetts, South Carolina and Florida. The Company provides transportation invoice rating, payment processing, auditing, accounting and transportation information. It is also a processor and payer of energy invoices, including electricity, gas, waste, and other facility related expenses. The Company operates in two segments: Information Services and Banking Services. The Information Services segment provides transportation, energy, telecommunication, and environmental invoice processing and payment services to large corporations. The Banking Services segment provides banking services primarily to privately held businesses and churches. The Company, through its bank subsidiary, Cass Commercial Bank (the Bank), provides commercial banking services.
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