Analyzing RR Donnelley & Sons Co (RRD) and Deluxe Corporation (DLX)

RR Donnelley & Sons Co (NASDAQ: RRD) and Deluxe Corporation (NYSE:DLX) are both industrials companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, dividends, risk, analyst recommendations, profitability, valuation and earnings.

Profitability

This table compares RR Donnelley & Sons Co and Deluxe Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
RR Donnelley & Sons Co 4.66% N/A 7.95%
Deluxe Corporation 11.98% 27.83% 11.83%

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for RR Donnelley & Sons Co and Deluxe Corporation, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
RR Donnelley & Sons Co 0 0 0 0 N/A
Deluxe Corporation 0 0 0 0 N/A

Institutional and Insider Ownership

91.3% of Deluxe Corporation shares are owned by institutional investors. 2.4% of Deluxe Corporation shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Volatility & Risk

RR Donnelley & Sons Co has a beta of 1.74, indicating that its share price is 74% more volatile than the S&P 500. Comparatively, Deluxe Corporation has a beta of 1.35, indicating that its share price is 35% more volatile than the S&P 500.

Dividends

RR Donnelley & Sons Co pays an annual dividend of $1.04 per share and has a dividend yield of 10.2%. Deluxe Corporation pays an annual dividend of $1.20 per share and has a dividend yield of 1.6%. RR Donnelley & Sons Co pays out 196.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Deluxe Corporation pays out 25.6% of its earnings in the form of a dividend.

Earnings and Valuation

This table compares RR Donnelley & Sons Co and Deluxe Corporation’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
RR Donnelley & Sons Co $6.94 billion 0.10 $372.90 million $0.53 19.15
Deluxe Corporation $1.91 billion 1.87 $453.00 million $4.68 15.74

Deluxe Corporation has higher revenue, but lower earnings than RR Donnelley & Sons Co. Deluxe Corporation is trading at a lower price-to-earnings ratio than RR Donnelley & Sons Co, indicating that it is currently the more affordable of the two stocks.

Summary

Deluxe Corporation beats RR Donnelley & Sons Co on 9 of the 12 factors compared between the two stocks.

About RR Donnelley & Sons Co

R.R. Donnelley & Sons Company helps organizations communicate by working to create, manage, produce, distribute and process content on behalf of its customers. The Company’s segments include Variable Print, Strategic Services, International and Corporate. The Variable Print segment includes the Company’s United States short-run and transactional printing operations. The Variable Print segment’s primary product offerings include commercial and digital print, direct mail, labels, statement printing, forms and packaging. The Strategic Services segment includes the Company’s logistics services, print management offerings and digital and creative solutions. The International segment includes the Company’s non-United States printing operations in Asia, Latin America and Canada. The International segment’s primary product and service offerings include magazines, catalogs, retail inserts, books, directories, direct mail, logistics services and digital and creative solutions.

About Deluxe Corporation

Deluxe Corporation is a provider of payment solutions. The Company provides a suite of customer life cycle management solutions to its customers across multiple channels. The Company operates in three segments: Small Business Services segment, Financial Services segment and Direct Checks segment. The Company’s product and service offerings consist of checks, forms and accessories, and other products. The forms offered by the Company include deposit tickets and check registers. Its accessories and other products include checkbook covers and stamps. The Small Business Services segment is a provider of printed forms to small businesses. The Financial Services segment provides products and services to financial institution clients and offers a suite of financial technology (FinTech) solutions. The Direct Checks segment is a direct-to-consumer check supplier. It also offers fraud protection and security services, online and offline payroll services, and electronic checks (e-checks).

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