Analyzing Vertiv (NYSE:VRT) and Dynatrace (NYSE:DT)

Dynatrace (NYSE:DT) and Vertiv (NYSE:VRT) are both large-cap computer and technology companies, but which is the superior stock? We will compare the two businesses based on the strength of their risk, institutional ownership, earnings, dividends, analyst recommendations, valuation and profitability.

Profitability

This table compares Dynatrace and Vertiv’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Dynatrace	27.33%	9.24%	6.14%
Vertiv	10.67%	50.82%	14.98%

Insider and Institutional Ownership

94.3% of Dynatrace shares are held by institutional investors. Comparatively, 89.9% of Vertiv shares are held by institutional investors. 0.6% of Dynatrace shares are held by company insiders. Comparatively, 5.0% of Vertiv shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Risk & Volatility

Dynatrace has a beta of 0.87, indicating that its stock price is 13% less volatile than the S&P 500. Comparatively, Vertiv has a beta of 2.03, indicating that its stock price is 103% more volatile than the S&P 500.

Valuation and Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Dynatrace	$1.70 billion	7.91	$483.68 million	$1.67	26.70
Vertiv	$8.01 billion	7.93	$495.80 million	$2.65	62.74

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

Analyst Ratings

This is a summary of current ratings and price targets for Dynatrace and Vertiv, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Dynatrace	0	6	17	1	2.79
Vertiv	1	6	20	2	2.79

Dynatrace presently has a consensus price target of $61.59, indicating a potential upside of 38.14%. Vertiv has a consensus price target of $180.48, indicating a potential upside of 8.54%. Given Dynatrace’s higher probable upside, analysts plainly believe Dynatrace is more favorable than Vertiv.

Summary

Vertiv beats Dynatrace on 12 of the 15 factors compared between the two stocks.

About Dynatrace

Dynatrace, Inc. provides a security platform for multicloud environments in North America, Europe, the Middle East, Africa, the Asia Pacific, and Latin America. The company operates Dynatrace, a security platform, which provides application and microservices monitoring, runtime application security, infrastructure monitoring, log management and analytics, digital experience monitoring, digital business analytics, and cloud automation. Its platform allows its customers to modernize and automate IT operations, delivers software, and enhance user experiences. In addition, the company offers implementation, consulting, and training services. It markets its products through a combination of direct sales team and a network of partners, including resellers, system integrators, and managed service providers. It serves customers in various industries comprising banking, financial services, government, insurance, retail and wholesale, transportation, and software. Dynatrace, Inc. was founded in 2005 and is headquartered in Waltham, Massachusetts.

About Vertiv

Vertiv Holdings Co, together with its subsidiaries, designs, manufactures, and services critical digital infrastructure technologies and life cycle services for data centers, communication networks, and commercial and industrial environments in the Americas, the Asia Pacific, Europe, the Middle East, and Africa. It offers AC and DC power management products, switchgear and busbar products, thermal management products, integrated rack systems, modular solutions, and management systems for monitoring and controlling digital infrastructure that are integral to the technologies used for various services, including e-commerce, online banking, file sharing, video on-demand, energy storage, wireless communications, Internet of Things, and online gaming. The company also provides lifecycle management services, predictive analytics, and professional services for deploying, maintaining, and optimizing its products and their related systems; and preventative maintenance, acceptance testing, engineering and consulting, performance assessments, remote monitoring, training, spare parts, and digital critical infrastructure software services. It offers its products primarily under the Vertiv, Liebert, NetSure, Geist, E&I, Powerbar, and Avocent brands. The company serves cloud services, financial services, healthcare, transportation, manufacturing, energy, education, government, social media, and retail industries through a network of direct sales professionals, independent sales representatives, channel partners, and original equipment manufacturers. Vertiv Holdings Co is headquartered in Westerville, Ohio.