Critical Analysis: SGS (OTCMKTS:SGSOY) vs. Willdan Group (NASDAQ:WLDN)

SGS (OTCMKTS:SGSOY) and Willdan Group (NASDAQ:WLDN) are both business services companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, analyst recommendations, risk, valuation, institutional ownership, profitability and dividends.

Analyst Recommendations

This is a summary of recent ratings for SGS and Willdan Group, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SGS	1	2	1	3	2.86
Willdan Group	0	1	3	0	2.75

Willdan Group has a consensus price target of $124.33, indicating a potential downside of 7.06%. Given Willdan Group’s higher probable upside, analysts clearly believe Willdan Group is more favorable than SGS.

Insider & Institutional Ownership

72.3% of Willdan Group shares are owned by institutional investors. 8.6% of Willdan Group shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Risk and Volatility

SGS has a beta of 0.74, meaning that its stock price is 26% less volatile than the S&P 500. Comparatively, Willdan Group has a beta of 0.96, meaning that its stock price is 4% less volatile than the S&P 500.

Profitability

This table compares SGS and Willdan Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SGS	N/A	N/A	N/A
Willdan Group	6.37%	20.23%	10.79%

Valuation and Earnings

This table compares SGS and Willdan Group”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SGS	$7.72 billion	3.00	$659.96 million	N/A	N/A
Willdan Group	$565.80 million	3.49	$22.57 million	$2.78	48.12

SGS has higher revenue and earnings than Willdan Group.

Summary

Willdan Group beats SGS on 9 of the 13 factors compared between the two stocks.

About SGS

SGS SA provides inspection, testing, and verification services in Europe, Africa, the Middle East, the Americas, and the Asia Pacific. It operates in five segments: Connectivity & Products, Health & Nutrition, Industries & Environment, Natural Resources, and Business Assurance. The company provides laboratory testing, product inspection and consulting, process assessment, technical and transactional assistance; and automotive, connectivity, softlines and accessories, and hardgoods, toys, and juvenile products, as well as government and trade facilitation services. In addition, it offers a range of testing, inspection and certification solutions for the crop science, food, health science, and cosmetics and hygiene industries; field services, technical assessment, and advisory services; and services related to industrial, public health and safety, environmental testing, and public mandates. Further, it provides assessment, auditing, and certification, supply chain assurance, training, consulting, and sustainability assurance services; agricultural commodities, geochemistry, laboratory testing petroleum and chemicals, metallurgy and consulting, mineral and metal commodities, and oil, gas, and chemical commodities; and sustainability solutions. The company serves the agriculture and food, chemical, construction, consumer and retail, energy, industrial manufacturing, life sciences, mining, oil and gas, public, and transportation sectors. SGS SA was founded in 1878 and is headquartered in Geneva, Switzerland.

About Willdan Group

Willdan Group, Inc., together with its subsidiaries, provides professional, technical, and consulting services primarily in the United States. It operates in two segments, Energy, and Engineering and Consulting. The Energy segment offers comprehensive audit and surveys, program design and implementation, master planning, demand reduction, grid optimization, benchmarking analyses, design engineering, construction management, performance contracting, installation, alternative financing, measurement and verification services, and software and data analytics, as well as energy consulting and engineering, turnkey facility and infrastructure projects, and customer support services. The Engineering and Consulting segment provides building and safety, city engineering and code enforcement, development plan review and inspection, disaster recovery, geotechnical and earthquake engineering, planning and surveying, contract staff support, program and construction management, structural engineering, transportation and traffic engineering, and water resources services. This segment also offers district administration, financial consulting, and federal compliance services. It serves public and governmental agencies, including cities, counties, redevelopment agencies, water districts, school districts, and universities; investor and municipal owned energy utilities; state and federal agencies; and commercial and industrial firms, as well as various other special districts and agencies. The company was founded in 1964 and is headquartered in Anaheim, California.