Critical Analysis: Western Union (NYSE:WU) and OLO (NYSE:OLO)

OLO (NYSE:OLO) and Western Union (NYSE:WU) are both computer and technology companies, but which is the better stock? We will compare the two businesses based on the strength of their institutional ownership, risk, valuation, earnings, analyst recommendations, profitability and dividends.

Earnings & Valuation

This table compares OLO and Western Union”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
OLO	$271.87 million	4.38	-$58.29 million	($0.10)	-72.80
Western Union	$4.20 billion	0.83	$626.00 million	$1.95	5.27

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

Analyst Ratings

This is a summary of current ratings and target prices for OLO and Western Union, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
OLO	0	1	2	0	2.67
Western Union	2	8	0	0	1.80

OLO currently has a consensus price target of $8.67, indicating a potential upside of 19.05%. Western Union has a consensus price target of $12.63, indicating a potential upside of 22.81%. Given Western Union’s higher probable upside, analysts clearly believe Western Union is more favorable than OLO.

Risk and Volatility

OLO has a beta of 1.42, suggesting that its share price is 42% more volatile than the S&P 500. Comparatively, Western Union has a beta of 0.85, suggesting that its share price is 15% less volatile than the S&P 500.

Profitability

This table compares OLO and Western Union’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
OLO	-5.89%	0.34%	0.30%
Western Union	16.07%	120.39%	7.44%

Institutional & Insider Ownership

93.4% of OLO shares are owned by institutional investors. Comparatively, 91.8% of Western Union shares are owned by institutional investors. 39.3% of OLO shares are owned by company insiders. Comparatively, 0.9% of Western Union shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Summary

Western Union beats OLO on 8 of the 14 factors compared between the two stocks.

About OLO

Olo, Inc. engages in the provision of cloud-based, on-demand commerce platform for multi-location restaurant brands. It enables digital ordering and delivery. The company was founded in 2005 and is headquartered in New York, NY.

About Western Union

The Western Union Company provides money movement and payment services worldwide. The company operates through Consumer Money Transfer and Consumer Services segments. The Consumer Money Transfer segment facilitates money transfers for international cross-border and intra-country transfers, primarily through a network of retail agent locations, as well as through websites and mobile devices. The Consumer Services segments offers bill payment services, which facilitate payments for consumers, businesses, and other organizations, as well as money order services, retail foreign exchange services, prepaid cards, lending partnerships, and digital wallets. The company was founded in 1851 and is headquartered in Denver, Colorado.