Analyzing CPI Card Group (NASDAQ:PMTS) & Ricoh (OTCMKTS:RICOY)

Ricoh (OTCMKTS:RICOY) and CPI Card Group (NASDAQ:PMTS) are both technology companies, but which is the better investment? We will compare the two companies based on the strength of their risk, dividends, analyst recommendations, institutional ownership, valuation, earnings and profitability.

Valuation and Earnings

This table compares Ricoh and CPI Card Group”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ricoh	$17.33 billion	0.35	$367.42 million	$0.94	11.38
CPI Card Group	$587.31 million	0.56	$14.95 million	$1.15	24.69

Ricoh has higher revenue and earnings than CPI Card Group. Ricoh is trading at a lower price-to-earnings ratio than CPI Card Group, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Ricoh and CPI Card Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ricoh	3.10%	6.98%	3.24%
CPI Card Group	2.34%	-145.74%	6.29%

Dividends

Ricoh pays an annual dividend of $0.15 per share and has a dividend yield of 1.4%. CPI Card Group pays an annual dividend of $0.18 per share and has a dividend yield of 0.6%. Ricoh pays out 16.0% of its earnings in the form of a dividend. CPI Card Group pays out 15.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Analyst Recommendations

This is a summary of current recommendations for Ricoh and CPI Card Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ricoh	0	0	0	0	0.00
CPI Card Group	0	2	4	0	2.67

CPI Card Group has a consensus price target of $30.25, indicating a potential upside of 6.56%. Given CPI Card Group’s stronger consensus rating and higher possible upside, analysts clearly believe CPI Card Group is more favorable than Ricoh.

Volatility & Risk

Ricoh has a beta of 0.39, meaning that its share price is 61% less volatile than the S&P 500. Comparatively, CPI Card Group has a beta of 0.97, meaning that its share price is 3% less volatile than the S&P 500.

Insider & Institutional Ownership

22.1% of CPI Card Group shares are owned by institutional investors. 5.8% of CPI Card Group shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

CPI Card Group beats Ricoh on 11 of the 16 factors compared between the two stocks.

About Ricoh

Ricoh Company, Ltd. provides office, commercial printing, and related solutions worldwide. It operates through Digital services, Digital Products, Graphic Communications, Industrial Solutions, and Other segments. The company sells multifunctional printers (MFPs), laser printers, digital duplicators, wide format printers, facsimile machines, scanners, personal computers, servers, network equipment, related parts and supplies, services, and support and service and solutions related to documents. It also offers production and OEM services for MFPs, laser printers, digital duplicators, wide format printers, facsimile machine, scanners, network equipment, and related parts and supplies. In addition, the company produces and sells cut sheet printers, continuous feed printers, inkjet heads, imaging systems, industrial printers, related parts and supplies, services, and support and software. Further, it produces and sells thermal paper and media products, industrial optical components/modules, and electronic components and precision mechanical components, as well as offers digital cameras, 360°cameras, and environment and healthcare products. The company was formerly known as Riken Optical Co., Ltd. and changed its name to Ricoh Company, Ltd. in 1963. Ricoh Company, Ltd. was incorporated in 1936 and is headquartered in Tokyo, Japan.

About CPI Card Group

CPI Card Group Inc., together with its subsidiaries, engages in the design, production, data personalization, packaging, and fulfillment of financial payment cards. It operates through Debit and Credit, and Prepaid Debit segments. The Debit and Credit segment produces financial payment cards and provides integrated card services to card-issuing financial institutions. Its products include Europay, Mastercard, and Visa (EMV) and non-EMV financial payment cards, including contact and contactless cards, plastic and encased metal cards, and Second Wave payment cards, as well as private label credit cards. This segment also provides on-demand services and various integrated card services, including card personalization and fulfillment, as well as instant issuance services. The Prepaid Debit segment primarily offers integrated card services comprising tamper-evident security packaging services to prepaid debit card providers. It also produces financial payment cards issued on the networks of the payment card brands. It serves issuers of debit and credit cards, Prepaid Debit Card program managers, community banks, credit unions, and group service providers in the United States. The company was formerly known as CPI Holdings I, Inc. and changed its name to CPI Card Group Inc. in August 2015. CPI Card Group Inc. was incorporated in 2007 and is headquartered in Littleton, Colorado.