Contrasting Concentrix (NASDAQ:CNXC) & Secom (OTCMKTS:SOMLY)

Secom (OTCMKTS:SOMLY) and Concentrix (NASDAQ:CNXC) are both business services companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, risk, profitability, institutional ownership, earnings and dividends.

Dividends

Secom pays an annual dividend of $0.12 per share and has a dividend yield of 1.3%. Concentrix pays an annual dividend of $1.33 per share and has a dividend yield of 2.3%. Concentrix pays out 36.5% of its earnings in the form of a dividend. Concentrix has raised its dividend for 3 consecutive years. Concentrix is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk and Volatility

Secom has a beta of 0.46, meaning that its stock price is 54% less volatile than the S&P 500. Comparatively, Concentrix has a beta of 0.53, meaning that its stock price is 47% less volatile than the S&P 500.

Valuation & Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Secom	$7.88 billion	2.12	$713.52 million	N/A	N/A
Concentrix	$9.62 billion	0.38	$251.22 million	$3.64	16.02

Secom has higher earnings, but lower revenue than Concentrix.

Institutional & Insider Ownership

90.3% of Concentrix shares are held by institutional investors. 3.2% of Concentrix shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Secom and Concentrix’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Secom	N/A	N/A	N/A
Concentrix	2.54%	16.31%	5.56%

Analyst Recommendations

This is a summary of recent recommendations for Secom and Concentrix, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Secom	0	0	0	0	0.00
Concentrix	0	1	3	1	3.00

Concentrix has a consensus price target of $66.75, indicating a potential upside of 14.44%. Given Concentrix’s stronger consensus rating and higher probable upside, analysts clearly believe Concentrix is more favorable than Secom.

Summary

Concentrix beats Secom on 13 of the 16 factors compared between the two stocks.

About Secom

SECOM CO., LTD., together with its subsidiaries, provides security services in Japan and internationally. The company operates through Security Services, Fire Protection Services, Medical Services, Insurance Services, Geospatial Information Services, BPO and ICT Services, and Other Services. The Security Services segment offers static guard, armored car, merchandise, and other services, as well as online security systems. The Fire Protection Services segment provides fire alarm systems, fire extinguishing systems, and maintenance services to office buildings, production facilities, tunnels, cultural properties, ships, and residences. The Medical Services segment offers home nursing, pharmaceutical dispensing, home delivery services, health and preventative care services, and personal and outpatient care services; and cloud-based medical reporting services and SECOM LINKus application. This segment also operates the general hospital and residences for seniors; and sells medical equipment and pharmaceuticals. The Insurance Services Segment provides fire insurance, automobile insurance, and cancer treatment insurance services. The Geospatial Information Services segment offers geospatial information services to public-sector entities, such as national and local governments; private sector customers; and overseas government agencies. The BPO and ICT Services segment provides contact centers and back office support services, data center, disaster preparedness, information security, and cloud-based services, as well as SaaS solutions. The Other Services segment offers real estate leasing, construction, and installation services. The company was incorporated in 1962 and is headquartered in Tokyo, Japan.

About Concentrix

Concentrix Corporation engages in the provision of technology-infused customer experience (CX) solutions worldwide. The company provides CX process optimization, technology innovation, front- and back-office automation, analytics, and business transformation services, across various channels of communication, such as voice, chat, email, social media, asynchronous messaging, and custom applications. It also offers customer lifecycle management; customer experience/user experience strategy and design; analytics and actionable insights; digital transformation services that design and engineer CX solutions to enable efficient customer self-service and build customer loyalty; customer engagement solutions and services that address the entirety of the customer lifecycle; AI technology that can intelligently act on customer intent to improve customer experience with non-human engagement; voice of the customer and analytics solutions to gather and analyze customer feedback to foster loyalty to, and growth with, clients; analytics and consulting solutions that synthesize data and provide professional insight to improve clients’ customer experience strategies; vertical business process outsourcing (BPO) services; and back office BPO services that support clients in non-customer facing areas. The company’s clients include technology and consumer electronics, retail, travel and e-commerce, communications and media, banking, financial services and insurance, healthcare, and others, as well as global IPOs, social brands, and banks. Concentrix Corporation was founded in 2004 and is based in Newark, California.