PayPal (NASDAQ:PYPL – Get Rating) and Envestnet (NYSE:ENV – Get Rating) are both computer and technology companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, profitability, risk, valuation, institutional ownership, analyst recommendations and earnings.
Risk and Volatility
PayPal has a beta of 1.45, meaning that its stock price is 45% more volatile than the S&P 500. Comparatively, Envestnet has a beta of 1.19, meaning that its stock price is 19% more volatile than the S&P 500.
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Institutional & Insider Ownership
70.7% of PayPal shares are held by institutional investors. 0.1% of PayPal shares are held by company insiders. Comparatively, 1.4% of Envestnet shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Profitability
This table compares PayPal and Envestnet's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
| PayPal | 7.79% | 16.79% | 4.65% |
| Envestnet | -2.42% | 7.52% | 3.23% |
Analyst Ratings
This is a summary of current recommendations and price targets for PayPal and Envestnet, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
| PayPal | 0 | 12 | 31 | 0 | 2.72 |
| Envestnet | 0 | 2 | 4 | 1 | 2.86 |
PayPal currently has a consensus target price of $138.93, indicating a potential upside of 44.37%. Envestnet has a consensus target price of $72.33, indicating a potential upside of 35.84%. Given PayPal's higher possible upside, analysts plainly believe PayPal is more favorable than Envestnet.
Earnings and Valuation
This table compares PayPal and Envestnet's top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
| PayPal | $25.37 billion | 4.39 | $4.17 billion | $1.74 | 55.30 |
| Envestnet | $1.19 billion | 2.48 | $13.30 million | ($0.55) | -96.82 |
PayPal has higher revenue and earnings than Envestnet. Envestnet is trading at a lower price-to-earnings ratio than PayPal, indicating that it is currently the more affordable of the two stocks.
Summary
PayPal beats Envestnet on 12 of the 15 factors compared between the two stocks.
About PayPal
(Get Rating)
PayPal Holdings, Inc. operates a technology platform that enables digital payments on behalf of merchants and consumers worldwide. It provides payment solutions under the PayPal, PayPal Credit, Braintree, Venmo, Xoom, Zettle, Hyperwallet, Honey, and Paidy names. The company's payments platform allows consumers to send and receive payments in approximately 200 markets and in approximately 100 currencies, withdraw funds to their bank accounts in 56 currencies, and hold balances in their PayPal accounts in 25 currencies. PayPal Holdings, Inc. was founded in 1998 and is headquartered in San Jose, California.
About Envestnet
(Get Rating)
Envestnet, Inc., together with its subsidiaries, provides wealth management software and services in the United States and internationally. It operates through Envestnet Wealth Solutions and Envestnet Data & Analytics segments. The company's product and services include Envestnet | Enterprise, which provides an end-to-end open architecture wealth management platform, as well as offers data aggregation and reporting, data analytics, and digital advice capabilities; Envestnet | Tamarac that provides trading, rebalancing, portfolio accounting, performance reporting, and client relationship management software; and Envestnet | MoneyGuide that provides goals-based financial planning solutions to the financial services industry. It also provides Envestnet | Retirement Solutions, which offer a suite of services for advisor-sold retirement plans; and Envestnet | Portfolio Management Consultants that provide research and consulting services to assist advisors in creating investment solutions for their clients, and portfolio overlay and tax optimization services, as well as data aggregation and data intelligence platform, which offers cloud-based innovation for digital financial services. Envestnet, Inc. was founded in 1999 and is headquartered in Chicago, Illinois.
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