Critical Contrast: Elcom International (OTCMKTS:ELCO) & Open Text (NASDAQ:OTEX)

Elcom International (OTCMKTS:ELCO) and Open Text (NASDAQ:OTEX) are both computer and technology companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, risk, institutional ownership, profitability, earnings, dividends and valuation.

Valuation & Earnings

This table compares Elcom International and Open Text”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Elcom International	N/A	N/A	N/A	N/A	N/A
Open Text	$5.17 billion	1.85	$435.87 million	$1.65	22.87

Open Text has higher revenue and earnings than Elcom International.

Risk and Volatility

Elcom International has a beta of 0.14, suggesting that its stock price is 86% less volatile than the S&P 500. Comparatively, Open Text has a beta of 1.16, suggesting that its stock price is 16% more volatile than the S&P 500.

Insider and Institutional Ownership

70.4% of Open Text shares are held by institutional investors. 13.6% of Elcom International shares are held by company insiders. Comparatively, 10.6% of Open Text shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Elcom International and Open Text’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Elcom International	N/A	N/A	N/A
Open Text	8.43%	22.52%	6.72%

Analyst Ratings

This is a breakdown of recent ratings and target prices for Elcom International and Open Text, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Elcom International	0	0	0	0	0.00
Open Text	1	5	5	0	2.36

Open Text has a consensus price target of $36.55, indicating a potential downside of 3.14%. Given Open Text’s stronger consensus rating and higher possible upside, analysts plainly believe Open Text is more favorable than Elcom International.

Summary

Open Text beats Elcom International on 9 of the 10 factors compared between the two stocks.

About Elcom International

Elcom International Inc. provides cloud based e-procurement solutions worldwide. It offers Procure to Pay solutions to publish and manage supplier content, connect to buyers, and analyze spend and procurement processes; eInvoicing solutions to send and receive eInvoices with supplier adoption guaranteed; and sourcing functions to investigate potential suppliers on a local and global basis. The company also provides services for buyers, including catalog processing, development of punchout catalogs, and to integrate Elcom’s PECOS solution into existing purchasing processes; and services for suppliers, such as onboarding of new suppliers to utilize the solution, access to demand generating activities, and to access information and bids that relate to products and services. It offers eProcurement solutions for governments, educational institutions, healthcare organizations, private enterprises, buying groups. Elcom International Inc. was founded in 1992 and is based in Braintree, Massachusetts.

About Open Text

Open Text Corporation provides information management software and solutions. The company offers content services, which includes content collaboration and intelligent capture to records management, collaboration, e-signatures, and archiving; and operates experience cloud platform that provides customer experience and web content management, digital asset management, customer analytics, AI and insights, e-discovery, digital fax, omnichannel communications, secure messaging, and voice of customer, as well as customer journey, testing, and segmentation. It also provides cybersecurity cloud solutions to protect, prevent, detect, respond and quickly recover from threats across endpoints, network, applications, IT infrastructure and data, AI-led threat intelligence; and to protect critical information and processes through threat intelligence, forensics, identity, encryption, and cloud-based application security. In addition, the company offers business network cloud for digital supply chains and secure e-commerce ecosystems including digitize and automate procure-to-pay and order-to-cash processes; IT operations management cloud for automation and advancement of IT support and asset management; and analytics & AI cloud solutions that offers artificial intelligence with practical usage to provide organizations with actionable insights and better automation, such as visualizations, advanced natural language processing and understanding, and integrated computer vision capabilities. In addition, it provides application automation cloud, developers cloud, and services. Further, it has strategic partnerships with SAP SE, Google Cloud, Amazon AWS, Microsoft Corporation, Oracle Corporation, Salesforce.com Corporation, DXC Technology Company, Accenture plc, Capgemini Technology Services SAS, Deloitte Consulting LLP, Hewlett Packard Enterprises, and Tata Consultancy Services. Open Text Corporation was incorporated in 1991 and is headquartered in Waterloo, Canada.