Financial Contrast: Broadridge Financial Solutions (NYSE:BR) and Concentrix (NASDAQ:CNXC)

Broadridge Financial Solutions (NYSE:BRGet Rating) and Concentrix (NASDAQ:CNXCGet Rating) are both business services companies, but which is the better stock? We will compare the two companies based on the strength of their risk, dividends, institutional ownership, earnings, analyst recommendations, profitability and valuation.

Valuation & Earnings

This table compares Broadridge Financial Solutions and Concentrix’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Broadridge Financial Solutions $4.99 billion 3.62 $547.50 million $4.57 33.88
Concentrix $5.59 billion 1.44 $405.58 million $8.09 19.01

Broadridge Financial Solutions has higher earnings, but lower revenue than Concentrix. Concentrix is trading at a lower price-to-earnings ratio than Broadridge Financial Solutions, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Broadridge Financial Solutions and Concentrix’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Broadridge Financial Solutions 10.05% 39.99% 9.37%
Concentrix 7.40% 20.51% 9.79%

Dividends

Broadridge Financial Solutions pays an annual dividend of $2.56 per share and has a dividend yield of 1.7%. Concentrix pays an annual dividend of $1.00 per share and has a dividend yield of 0.7%. Broadridge Financial Solutions pays out 56.0% of its earnings in the form of a dividend. Concentrix pays out 12.4% 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. Broadridge Financial Solutions has increased its dividend for 15 consecutive years. Broadridge Financial Solutions is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk and Volatility

Broadridge Financial Solutions has a beta of 0.96, suggesting that its share price is 4% less volatile than the S&P 500. Comparatively, Concentrix has a beta of 0.01, suggesting that its share price is 99% less volatile than the S&P 500.

Institutional and Insider Ownership

86.5% of Broadridge Financial Solutions shares are owned by institutional investors. Comparatively, 76.0% of Concentrix shares are owned by institutional investors. 1.9% of Broadridge Financial Solutions shares are owned by insiders. Comparatively, 1.0% of Concentrix shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of current ratings for Broadridge Financial Solutions and Concentrix, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Broadridge Financial Solutions 0 2 1 0 2.33
Concentrix 0 0 1 0 3.00

Broadridge Financial Solutions currently has a consensus price target of $182.33, indicating a potential upside of 17.76%. Concentrix has a consensus price target of $202.00, indicating a potential upside of 31.36%. Given Concentrix’s stronger consensus rating and higher probable upside, analysts plainly believe Concentrix is more favorable than Broadridge Financial Solutions.

Summary

Broadridge Financial Solutions beats Concentrix on 10 of the 16 factors compared between the two stocks.

Broadridge Financial Solutions Company Profile (Get Rating)

Broadridge Financial Solutions, Inc. engages in the provision of investor communications and technology solutions to banks, broker-dealers, mutual funds, and corporate issuers. It operates through the following segments: Investor Communication Solutions and Global Technology and Operations. The Investor Communication Solutions segment offers services for broker-dealer investor communication, customer communication, corporate issuer, advisor solutions, and mutual fund and retirement solutions. The Global Technology and Operations segment includes middle and back-office securities processing solutions, automation services, and business process outsourcing services. The company was founded in 1962 and is headquartered in Lake Success, NY.

Concentrix Company Profile (Get Rating)

Concentrix Corporation provides technology-infused customer experience solutions worldwide. It provides CX process optimization, technology innovation, front- and back-office automation, analytics, and business transformation services. The company also offers customer lifecycle management; customer experience/user experience strategy and design; digital transformation; and voice of the customer and analytics solutions. Its strategic verticals include technology and consumer electronics, communications and media, retail, travel and e-commerce, banking, financial services and insurance, healthcare, and others. The company's clients include digital, internet, health insurance, and automotive companies, as well as banks. Concentrix Corporation was incorporated in 2009 and is based in Fremont, California.

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