Stantec (NYSE:STN) versus Equifax (NYSE:EFX) Head to Head Review

Stantec (NYSE:STN) and Equifax (NYSE:EFX) are both large-cap business services companies, but which is the better business? We will contrast the two businesses based on the strength of their dividends, analyst recommendations, risk, valuation, profitability, institutional ownership and earnings.

Insider & Institutional Ownership

63.9% of Stantec shares are held by institutional investors. Comparatively, 96.2% of Equifax shares are held by institutional investors. 0.5% of Stantec shares are held by company insiders. Comparatively, 1.4% of Equifax shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Stantec and Equifax’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Stantec	5.01%	18.22%	7.61%
Equifax	10.68%	18.81%	7.60%

Volatility and Risk

Stantec has a beta of 1.03, indicating that its stock price is 3% more volatile than the S&P 500. Comparatively, Equifax has a beta of 1.6, indicating that its stock price is 60% more volatile than the S&P 500.

Dividends

Stantec pays an annual dividend of $0.66 per share and has a dividend yield of 0.6%. Equifax pays an annual dividend of $2.00 per share and has a dividend yield of 0.8%. Stantec pays out 27.3% of its earnings in the form of a dividend. Equifax pays out 40.9% 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. Stantec has increased its dividend for 13 consecutive years and Equifax has increased its dividend for 1 consecutive years.

Valuation and Earnings

This table compares Stantec and Equifax”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Stantec	$5.47 billion	2.29	$263.82 million	$2.42	45.48
Equifax	$5.73 billion	5.67	$604.10 million	$4.89	53.54

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

Analyst Recommendations

This is a breakdown of current ratings for Stantec and Equifax, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Stantec	0	0	6	0	3.00
Equifax	0	6	12	1	2.74

Equifax has a consensus target price of $294.94, indicating a potential upside of 12.65%. Given Equifax’s higher probable upside, analysts plainly believe Equifax is more favorable than Stantec.

Summary

Equifax beats Stantec on 14 of the 18 factors compared between the two stocks.

About Stantec

Stantec Inc. provides professional services in the areas of infrastructure and facilities to the public and private sectors in Canada, the United States, and internationally. It offers evaluation, planning, and designing infrastructure solutions; solutions for sustainable water resources, planning, management, and infrastructure; environmental services; integrated architecture, engineering, interior design, and planning solutions for buildings; and energy and resources solutions. The company also provides consulting services in engineering, architecture, interior design, landscape architecture, surveying, environmental sciences, project management, and project economics. In addition, it offers planning and design services to clients in residential, logistics, retail, infrastructure, energy, higher education, and urban regeneration sectors; architectural and interior design, and planning services in the science and technology, commercial workplace, higher education, residential, and hospitality markets. Further, the company provides transportation advisory, transport engineering, and technical design; project delivery consultancy services for mining, resources, and industrial infrastructure projects; paleontological and archaeological services for the rail, transportation, water, and power and energy sectors; and environmental and cultural resource compliance services. Additionally, it offers consulting services in sustainable building design, energy infrastructure upgrades, sustainable district heating network, and e-mobility; and planning, design, construction administration, commissioning, maintenance, decommissioning, and remediation services. The company was formerly known as Stanley Technology Group Inc. and changed its name to Stantec Inc. in October 1998. Stantec Inc. was founded in 1954 and is headquartered in Edmonton, Canada.

About Equifax

Equifax Inc. operates as a data, analytics, and technology company. The company operates through three segments: Workforce Solutions, U.S. Information Solutions (USIS), and International. The Workforce Solutions segment offers services that enables customers to verify income, employment, educational history, criminal justice data, healthcare professional licensure, and sanctions of people in the United States; and employer customers with services that assist them in complying with and automating payroll-related and human resource management processes throughout the entire cycle of the employment relationship. The USIS segment provides consumer and commercial information services, such as credit information and credit scoring, credit modeling and portfolio analytics, locate, fraud detection and prevention, identity verification, and other consulting services; mortgage services; financial marketing services; identity management services; and credit monitoring products. The International segment offers information service products, which include consumer and commercial services, such as credit and financial information, and credit scoring and modeling; and credit and other marketing products and services, as well as offers information, technology, and other services to support debt collections and recovery management. The company serves customers in financial services, mortgage, retail, telecommunications, utilities, automotive, brokerage, healthcare, and insurance industries, as well as government agencies. It operates in Argentina, Australia, Brazil, Canada, Chile, Costa Rica, Dominican Republic, Ecuador, El Salvador, Honduras, India, Ireland, Mexico, New Zealand, Paraguay, Peru, Portugal, Spain, the United Kingdom, Uruguay, and the United States. The company was founded in 1899 and is headquartered in Atlanta, Georgia.