Financial Analysis: Mastercard (NYSE:MA) and RB Global (NYSE:RBA)

RB Global (NYSE:RBA) and Mastercard (NYSE:MA) are both large-cap business services companies, but which is the superior stock? We will contrast the two businesses based on the strength of their valuation, risk, dividends, institutional ownership, analyst recommendations, profitability and earnings.

Institutional & Insider Ownership

95.4% of RB Global shares are owned by institutional investors. Comparatively, 97.3% of Mastercard shares are owned by institutional investors. 0.3% of RB Global shares are owned by company insiders. Comparatively, 0.1% of Mastercard shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares RB Global and Mastercard’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
RB Global	9.65%	9.66%	4.31%
Mastercard	45.28%	202.03%	29.11%

Dividends

RB Global pays an annual dividend of $1.24 per share and has a dividend yield of 1.2%. Mastercard pays an annual dividend of $3.48 per share and has a dividend yield of 0.6%. RB Global pays out 59.3% of its earnings in the form of a dividend. Mastercard pays out 22.3% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. RB Global has increased its dividend for 20 consecutive years and Mastercard has increased its dividend for 13 consecutive years. RB Global is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation and Earnings

This table compares RB Global and Mastercard”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
RB Global	$4.28 billion	4.52	$413.10 million	$2.09	49.90
Mastercard	$31.47 billion	16.15	$12.87 billion	$15.64	36.19

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

Volatility & Risk

RB Global has a beta of 0.56, indicating that its share price is 44% less volatile than the S&P 500. Comparatively, Mastercard has a beta of 0.87, indicating that its share price is 13% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for RB Global and Mastercard, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
RB Global	0	2	6	0	2.75
Mastercard	0	3	22	5	3.07

RB Global currently has a consensus price target of $122.88, suggesting a potential upside of 17.83%. Mastercard has a consensus price target of $654.81, suggesting a potential upside of 15.70%. Given RB Global’s higher probable upside, research analysts plainly believe RB Global is more favorable than Mastercard.

Summary

Mastercard beats RB Global on 13 of the 18 factors compared between the two stocks.

About RB Global

RB Global, Inc., an omnichannel marketplace, provides insights, services, and transaction solutions for buyers and sellers of commercial assets and vehicles worldwide. Its marketplace brands include Ritchie Bros., an auctioneer of commercial assets and vehicles offering online bidding; IAA, a digital marketplace connecting vehicle buyers and sellers; Rouse Services, which provides asset management, data-driven intelligence, and performance benchmarking system; SmartEquip, a technology platform that supports customers' management of the equipment lifecycle; and Veritread, an online marketplace for heavy haul transport solution. The company's brands include GovPlanet, an online marketplace for the sale of government and military assets; RB Auction, an onsite and online marketplace for selling and buying used equipment; IronPlanet, an online marketplace for selling and buying used equipment; Marketplace-E, an online solution that make offers/buy now format; Rouse Appraisals, a certified appraisal service solution; Ritchie List Mascus, an online equipment listing service and B2B dealer portal; CSAToday, an online reporting and analysis tool that gives sellers the ability to manage their vehicle assets and monitor sales performance; and Catastrophe Response Services. In addition, it offers title, data, transportation and logistics, refurbishing, inspection, and financial services. It serves customers across various asset classes, including automotive, commercial transportation, construction, government surplus, lifting and material handling, energy, mining, and agriculture. RB Global, Inc. was founded in 1958 and is headquartered in Westchester, Illinois.

About Mastercard

Mastercard Incorporated, a technology company, provides transaction processing and other payment-related products and services in the United States and internationally. The company offers integrated products and value-added services for account holders, merchants, financial institutions, digital partners, businesses, governments, and other organizations, such as programs that enable issuers to provide consumers with credits to defer payments; payment products and solutions that allow its customers to access funds in deposit and other accounts; prepaid programs services; and commercial credit, debit, and prepaid payment products and solutions. It also provides solutions that enable businesses or governments to make payments to businesses, including Virtual Card Number, which is generated dynamically from a physical card and leverages the credit limit of the funding account; a platform to optimize supplier payment enablement campaigns for financial institutions; and treasury intelligence platform that offers corporations with recommendations to enhance working capital performance and accelerate spend on cards. In addition, the company offers Mastercard Send, which partners with digital messaging and payment platforms to enable consumers to send money directly within applications to other consumers; and Mastercard Cross-Border Services enables a range of payment flows through a distribution network with a single point of access to send and receive money globally through various channels, including bank accounts, mobile wallets, cards, and cash payouts. Further, it provides cyber and intelligence solutions; insights and analytics, consulting, marketing, loyalty, processing, and payment gateway solutions for e-commerce merchants; and open banking and digital identity services. The company offers payment solutions and services under the MasterCard, Maestro, and Cirrus name. Mastercard Incorporated was founded in 1966 and is headquartered in Purchase, New York.