Critical Review: Lesaka Technologies (NASDAQ:LSAK) versus Flywire (NASDAQ:FLYW)

Lesaka Technologies (NASDAQ:LSAK) and Flywire (NASDAQ:FLYW) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their analyst recommendations, profitability, risk, institutional ownership, dividends, valuation and earnings.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Lesaka Technologies and Flywire, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lesaka Technologies	1	1	0	1	2.33
Flywire	0	7	8	0	2.53

Lesaka Technologies presently has a consensus target price of $7.56, suggesting a potential upside of 78.30%. Flywire has a consensus target price of $20.23, suggesting a potential upside of 13.66%. Given Lesaka Technologies’ higher probable upside, equities analysts clearly believe Lesaka Technologies is more favorable than Flywire.

Valuation and Earnings

This table compares Lesaka Technologies and Flywire”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Lesaka Technologies	$721.55 million	0.50	$2.76 million	$0.04	106.00
Flywire	$623.03 million	3.48	$13.50 million	$0.26	68.46

Flywire has lower revenue, but higher earnings than Lesaka Technologies. Flywire is trading at a lower price-to-earnings ratio than Lesaka Technologies, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

24.2% of Lesaka Technologies shares are owned by institutional investors. Comparatively, 95.9% of Flywire shares are owned by institutional investors. 5.1% of Lesaka Technologies shares are owned by insiders. Comparatively, 5.0% of Flywire shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Lesaka Technologies and Flywire’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Lesaka Technologies	0.43%	1.65%	0.46%
Flywire	4.77%	4.08%	2.81%

Risk & Volatility

Lesaka Technologies has a beta of 0.33, indicating that its share price is 67% less volatile than the S&P 500. Comparatively, Flywire has a beta of 1.3, indicating that its share price is 30% more volatile than the S&P 500.

Summary

Flywire beats Lesaka Technologies on 10 of the 15 factors compared between the two stocks.

About Lesaka Technologies

Lesaka Technologies, Inc. operates as a Fintech company that utilizes its proprietary banking and payment technologies to deliver financial services solutions to merchants (B2B) and consumers (B2C) in Southern Africa. It offers cash management solutions, growth capital, card acquiring, bill payment technologies, and value-added services to formal and informal retail merchants, as well as banking, lending, and insurance solutions to consumers across Southern Africa. The company also engages in the sale of POS devices, SIM cards, and other consumables; and license of rights to use certain technology developed by the company, as well as offers related technology services. The company was formerly known as Net 1 UEPS Technologies, Inc. and changed its name to Lesaka Technologies, Inc. in May 2022. Lesaka Technologies, Inc. was incorporated in 1997 and is headquartered in Johannesburg, South Africa.

About Flywire

Flywire Corporation, together with its subsidiaries, operates as a payments enablement and software company in the United States and internationally. Its payment platform and network, and vertical-specific software help clients to get paid and help their customers to pay. The company’s platform facilitates payment flows across multiple currencies, payment types, and payment options, as well as provides direct connections to alternative payment methods, such as Alipay, Boleto, PayPal/Venmo, and Trustly. It serves education, healthcare, travel, and business to business organizations. The company was formerly known as peerTransfer Corporation and changed its name to Flywire Corporation in December 2016. Flywire Corporation was incorporated in 2009 and is headquartered in Boston, Massachusetts.