Digital Transactions Authoritative, insightful and timely information for payments professionals
Payments software and infrastructure companies rank third among 24 financial-technology sectors when viewed through the lens of stock price and earnings while point-of-sale device manufacturers rank 23rd, according to a new analysis from an investment firm.
The study by San Francisco-based Financial Technology Partners covers scores of publicly traded global companies in the 24 sectors, including five involving payments. One part of the analysis is a ranking of each sector on estimated price-earnings ratio for 2017—share price as a multiple of earnings per share. The estimates include prices updated as of July 31.
The fintech sector with the highest PE multiple is payroll, human-resources, and benefits-services providers, with a median estimated multiple of 46.9 times earnings, according to FT Partners. Next were fintechs in the lending, mortgage, and real-estate markets, with a median 2017 PE multiple of 30.9.
Payment software and infrastructure providers came in third with a median PE multiple of 29.7. The dozen companies FT Partners puts in this niche include Pegasystems, ACI Worldwide, Mitek Systems, and Cardtronics.
The second-highest payment sector was networks and merchant acquirers, a sector whose 10 members include Visa, Mastercard, and First Data. Their median estimated 2017 PE ratio is 24.1, good for eighth place.
Three other payments sectors rank in the bottom half of the 24. Prepaid and money-transfer providers came in at 16, with a median estimated PE multiple of 20.7. Processors and outsourcers, a group whose 11 members include PayPal, WEX, and FleetCor Technologies, have an estimated median PE multiple of 14.5 and rank 20th.
In 23rd place were POS device makers, with a 12.3 multiple. The five members of this group are Ingenico, Verifone, NCR, Pax Global Technology, and PAR Technology.
