Square or PayPal; What's the better investment?

Company overview 

Square- Founded in 2009 by Jack Dorsey and Jim McKelvey, Square helps business' of all sizes connect the customer's payment to the merchant's bank. located in San Fransisco they have changed the way small business' conduct everyday transactions. They represent small business' that would otherwise have issues getting a good point of sale system.

They offer a wide variety of hardware products, but what's most impressive is their software. They offer payroll services as well as an employee management and even offer help with online stores and processing payments online.

PayPal-  Found 11 years earlier than Square, PayPal has a similar product line up. Original founders most notably being Elon Musk and Peter Thiel, they had one vision in mind. That was to bring banking to the internet. Which they did. PayPal is for both personal and business banking- but they have a few products that Square does not have. They offer credit, not only to you and your business... But to your customer as well.

They have the upside of earning interest on credit- but have the downside of the risk.




Financial health

Cash and Cash Equivalents 
SQ- 789M
PYPL- 2.8B
ASSETS
SQ-1.7B
PYPL-32.6B
Net Income
SQ- (62M)
PYPL- 1.7B

Obviously, the company that is over a decade older has figured out things a new company is still learning... Even though PayPal has the massive financial advantage... Square is growing at a massive rate, but the gap is a big one to leap.

Square is finally starting to invest some money- they have invested 169 million in 2017, compared to PayPal's 2.8 billion it doesn't seem like much but PayPal had less invested in a similar time frame.

Paypal has a staggering 24B in total liabilities.
Square has 1.4B is liabilities.

Products and convenience


Check Processing
Square- Not offered
PayPal- Free

Customer Service
Square- Difficult to contact
PayPal- Easy contact with multiple contact points

Credit and debit card processing
Square-2.75%
Keyed- 3.50% + $0.15
PayPal-2.75%
Keyed- 3.50% + 0.15

Credit check
Square- None
Paypal- Must pass a background check and credit check.

Supported equipment 
Square- Apple products, androids, and support for older devices
PayPal- Apple products, androids and windows.

Future potential 

Square

Square has launched Caviar- a mobile app similar to Uber eats and Grubhub where you can order food from your local restaurant and have it delivered to by an employee. The Caviar sales have doubled year over year. There are still massive untapped regions of the country that have no delivery service similar to Caviar.

 That's not the only app they operate either- Cash App allows you to transfer money from one person to another instantly (for a fee of course). They have over 7 million active users.

PayPal

As online and e-commerce platforms become more and more popular, so does PayPal. They processed 7.6 billion transactions.. up 24% from just a year ago.

PayPal is planning on expanding to Pakistan, a massive international market which PayPal is not yet available in.




2 comments:

Facebook Massive Earnings Beat

      Could Facebook's earning beat finally be the boost that tech stocks need? They are up 6% today after crushing earnings... Other co...