Head to Head Review: Cognyte Software (NASDAQ:CGNT) and Constellation Software (OTCMKTS:CNSWF)

Constellation Software (OTCMKTS:CNSWF) and Cognyte Software (NASDAQ:CGNT) are both computer and technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, earnings, dividends, profitability, risk and institutional ownership.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Constellation Software and Cognyte Software, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Constellation Software	0	2	6	0	2.75
Cognyte Software	1	2	2	0	2.20

Cognyte Software has a consensus target price of $13.50, suggesting a potential upside of 61.29%. Given Cognyte Software’s higher possible upside, analysts clearly believe Cognyte Software is more favorable than Constellation Software.

Insider & Institutional Ownership

72.9% of Cognyte Software shares are owned by institutional investors. 62.7% of Cognyte Software shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Constellation Software and Cognyte Software’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Constellation Software	4.22%	49.29%	13.15%
Cognyte Software	-1.45%	-2.24%	-0.99%

Valuation and Earnings

This table compares Constellation Software and Cognyte Software”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Constellation Software	$11.62 billion	3.41	$512.00 million	$23.18	80.77
Cognyte Software	$350.63 million	1.74	-$12.05 million	($0.08)	-104.63

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

Volatility and Risk

Constellation Software has a beta of 1.03, indicating that its share price is 3% more volatile than the S&P 500. Comparatively, Cognyte Software has a beta of 1.64, indicating that its share price is 64% more volatile than the S&P 500.

Summary

Constellation Software beats Cognyte Software on 10 of the 14 factors compared between the two stocks.

About Constellation Software

Constellation Software Inc., together with its subsidiaries, acquires, builds, and manages vertical market software businesses in Canada, the United States, Europe, and internationally. It provides mission critical software solutions for public and private sector markets. The company is also involved in the software licensing; and sale of third-party hardware. In addition, it offers professional, and maintenance and other recurring services. Constellation Software Inc. was incorporated in 1995 and is headquartered in Toronto, Canada.

About Cognyte Software

Cognyte Software Ltd. provides an investigative analytics software to governments and enterprises worldwide. Its Actionable Intelligence for a Safer World, an open software designed to help governments and enterprises accelerate and enhance the effectiveness of investigations. The company offers network intelligence analytics, threat intelligence analytics, decision intelligence analytics, and operational intelligence analytics solutions. Its solutions are designed to support various use cases and support a range of users, including data analysts, investigation managers, and security operations center operators, as well as operational field teams. In addition, the company provides customer support, professional, and integration services. Its government customers include national, regional, and local government agencies. Cognyte Software Ltd. was incorporated in 2020 and is headquartered in Herzliya, Israel.