Square (SQ) and The Competition Head to Head Analysis

Square (NYSE: SQ) is one of 60 public companies in the “Application Software” industry, but how does it compare to its competitors? We will compare Square to similar companies based on the strength of its risk, dividends, profitability, institutional ownership, valuation, earnings and analyst recommendations.

Insider & Institutional Ownership

53.2% of Square shares are held by institutional investors. Comparatively, 68.8% of shares of all “Application Software” companies are held by institutional investors. 32.7% of Square shares are held by company insiders. Comparatively, 15.0% of shares of all “Application Software” companies are held 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.

Risk and Volatility

Square has a beta of 4.96, indicating that its stock price is 396% more volatile than the S&P 500. Comparatively, Square’s competitors have a beta of -0.04, indicating that their average stock price is 104% less volatile than the S&P 500.

Profitability

This table compares Square and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Square -3.04% -7.98% -3.18%
Square Competitors -25.99% -104.15% -13.63%

Earnings and Valuation

This table compares Square and its competitors top-line revenue, earnings per share and valuation.

Gross Revenue NetIncome Price/Earnings Ratio
Square $1.71 billion -$171.59 million -248.38
Square Competitors $916.05 million $45.64 million 474.70

Square has higher revenue, but lower earnings than its competitors. Square is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Square and its competitors, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Square 0 13 19 0 2.59
Square Competitors 175 1483 2787 86 2.61

Square presently has a consensus price target of $31.75, suggesting a potential downside of 20.11%. As a group, “Application Software” companies have a potential upside of 14.14%. Given Square’s competitors stronger consensus rating and higher possible upside, analysts clearly believe Square has less favorable growth aspects than its competitors.

About Square

Square, Inc. (Square) is a commerce ecosystem. The Company enables its sellers start, run and grow their businesses. It combines software with hardware to enable sellers to turn mobile devices and computing devices into payments and point-of-sale solutions. Once a seller downloads the Square Point of Sale mobile application, they can take their first payment. With its offering, a seller can accept payments in person via magnetic stripe (a swipe), Europay, MasterCard, and Visa (EMV) (a dip), or Near Field Communication (NFC) (a tap); or online via Square Invoices, Square Virtual Terminal, or the seller’s Website. Once on its system, sellers gain access to technology and features, such as reporting and analytics, next-day settlements, digital receipts, payment dispute management and chargeback protection, and Payment Card Industry (PCI) compliance. On the consumer (buyer) side, Square Cash offers individuals access to a way to send and receive money.

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