Contrasting Constellation Software (OTCMKTS:CNSWF) & CLEAR Secure (NYSE:YOU)

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

Risk and Volatility

Constellation Software has a beta of 1.02, meaning that its share price is 2% more volatile than the S&P 500. Comparatively, CLEAR Secure has a beta of 1.1, meaning that its share price is 10% more volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Constellation Software	4.22%	48.18%	12.82%
CLEAR Secure	12.12%	70.08%	9.25%

Insider and Institutional Ownership

73.8% of CLEAR Secure shares are owned by institutional investors. 39.7% of CLEAR Secure shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Constellation Software and CLEAR Secure”s 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	3.56	$512.00 million	$23.18	84.19
CLEAR Secure	$900.78 million	8.41	$109.17 million	$1.12	50.72

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

Dividends

Constellation Software pays an annual dividend of $4.00 per share and has a dividend yield of 0.2%. CLEAR Secure pays an annual dividend of $0.60 per share and has a dividend yield of 1.1%. Constellation Software pays out 17.3% of its earnings in the form of a dividend. CLEAR Secure pays out 53.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. CLEAR Secure has increased its dividend for 1 consecutive years. CLEAR Secure is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a summary of current ratings and price targets for Constellation Software and CLEAR Secure, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Constellation Software	0	2	6	0	2.75
CLEAR Secure	1	3	5	0	2.44

CLEAR Secure has a consensus target price of $53.14, indicating a potential downside of 6.45%. Given CLEAR Secure’s higher probable upside, analysts plainly believe CLEAR Secure is more favorable than Constellation Software.

Summary

CLEAR Secure beats Constellation Software on 9 of the 17 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 CLEAR Secure

Clear Secure, Inc. operates a secure identity platform under the CLEAR brand name primarily in the United States. Its secure identity platform is a multi-layered infrastructure consisting of front-end, including enrollment, verification, and linking, as well as back-end. The company also offers CLEAR Plus, a consumer aviation subscription service, which enables access to predictable entry lanes in airport security checkpoints, as well as access to broader network; and CLEAR mobile app, which is used to enroll new members and improve the experience for existing members. In addition, it provides RESERVE powered by CLEAR, a virtual queuing technology that provides users with the ability to book a dedicated time slot to go through security at the airport; CLEAR Verified, a B2B offering that extends secure identity platform to partners to create friction-free experiences for their customers; TSA PreCheck Enrollment Provided by CLEAR, as well as online renewal services; Atlas Certified, an automated solution to verify professional licenses and certification data across industries; and Sora ID that enables adding know your customer services to platform offerings, as well as virtual queuing technology that enables customers to manage lines. The company was founded in 2010 and is headquartered in New York, New York. Clear Secure, Inc. is a subsidiary of Alclear Investments, Llc.