Mastercard (NYSE:MA – Get Free Report) and Liquidity Services (NASDAQ:LQDT – Get Free Report) are both business services companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, earnings, valuation, risk, profitability, analyst recommendations and dividends.
Risk & Volatility
Mastercard has a beta of 1.1, suggesting that its share price is 10% more volatile than the S&P 500. Comparatively, Liquidity Services has a beta of 1.36, suggesting that its share price is 36% more volatile than the S&P 500.
Analyst Ratings
This is a summary of current recommendations and price targets for Mastercard and Liquidity Services, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Mastercard | 0 | 4 | 24 | 2 | 2.93 |
| Liquidity Services | 0 | 0 | 2 | 0 | 3.00 |
Profitability
This table compares Mastercard and Liquidity Services’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Mastercard | 45.71% | 188.47% | 30.05% |
| Liquidity Services | 6.37% | 20.94% | 11.32% |
Insider & Institutional Ownership
97.3% of Mastercard shares are owned by institutional investors. Comparatively, 71.2% of Liquidity Services shares are owned by institutional investors. 0.1% of Mastercard shares are owned by insiders. Comparatively, 28.4% of Liquidity Services shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Valuation & Earnings
This table compares Mastercard and Liquidity Services”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Mastercard | $28.17 billion | 18.16 | $12.87 billion | $13.89 | 40.13 |
| Liquidity Services | $414.32 million | 2.57 | $19.99 million | $0.75 | 45.75 |
Mastercard has higher revenue and earnings than Liquidity Services. Mastercard is trading at a lower price-to-earnings ratio than Liquidity Services, indicating that it is currently the more affordable of the two stocks.
Summary
Mastercard beats Liquidity Services on 10 of the 15 factors compared between the two stocks.
About Mastercard
Mastercard Incorporated, a technology company, provides transaction processing and other payment-related products and services in the United States and internationally. The company offers integrated products and value-added services for account holders, merchants, financial institutions, digital partners, businesses, governments, and other organizations, such as programs that enable issuers to provide consumers with credits to defer payments; payment products and solutions that allow its customers to access funds in deposit and other accounts; prepaid programs services; and commercial credit, debit, and prepaid payment products and solutions. It also provides solutions that enable businesses or governments to make payments to businesses, including Virtual Card Number, which is generated dynamically from a physical card and leverages the credit limit of the funding account; a platform to optimize supplier payment enablement campaigns for financial institutions; and treasury intelligence platform that offers corporations with recommendations to enhance working capital performance and accelerate spend on cards. In addition, the company offers Mastercard Send, which partners with digital messaging and payment platforms to enable consumers to send money directly within applications to other consumers; and Mastercard Cross-Border Services enables a range of payment flows through a distribution network with a single point of access to send and receive money globally through various channels, including bank accounts, mobile wallets, cards, and cash payouts. Further, it provides cyber and intelligence solutions; insights and analytics, consulting, marketing, loyalty, processing, and payment gateway solutions for e-commerce merchants; and open banking and digital identity services. The company offers payment solutions and services under the MasterCard, Maestro, and Cirrus name. Mastercard Incorporated was founded in 1966 and is headquartered in Purchase, New York.
About Liquidity Services
Liquidity Services, Inc. provides e-commerce marketplaces, self-directed auction listing tools, and value-added services in the United States and internationally. The company operates through four segments: GovDeals, Retail Supply Chain Group (RSCG), Capital Assets Group (CAG), and Machinio. Its marketplaces include liquidation.com that enable corporations to sell surplus and salvage consumer goods and retail capital assets; GovDeals marketplace, which provides self-directed service solutions in which sellers list their own assets that enables local and state government entities, and commercial businesses located in the United States and Canada to sell surplus and salvage assets; and AllSurplus, a centralized marketplace that connects global buyer base with assets from across the network of marketplaces in a single destination. The company also offers a suite of services, including surplus management, asset valuation, asset sales, marketing, returns management, asset recovery, and ecommerce services. In addition, it operates a global search engine platform for listing used equipment for sale in the construction, machine tool, transportation, printing, and agriculture sectors. The company offers products from industry verticals, such as consumer electronics, general merchandise, apparel, scientific equipment, aerospace parts and equipment, technology hardware, real estate, energy equipment, industrial capital assets, heavy equipment, fleet and transportation equipment, and specialty equipment. The company was incorporated in 1999 and is headquartered in Bethesda, Maryland.
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