Head to Head Analysis: SAP (NYSE:SAP) and Intuit (NASDAQ:INTU)

Intuit (NASDAQ:INTU) and SAP (NYSE:SAP) are both large-cap computer and technology companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, analyst recommendations, institutional ownership, risk, profitability, earnings and valuation.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Intuit and SAP, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Intuit	3	7	22	0	2.59
SAP	0	7	12	1	2.70

Intuit currently has a consensus price target of $490.39, indicating a potential upside of 68.47%. SAP has a consensus price target of $271.17, indicating a potential upside of 70.45%. Given SAP’s stronger consensus rating and higher possible upside, analysts clearly believe SAP is more favorable than Intuit.

Volatility and Risk

Intuit has a beta of 1, suggesting that its share price has a similar volatility profile to the S&P 500.Comparatively, SAP has a beta of 1.14, suggesting that its share price is 14% more volatile than the S&P 500.

Profitability

This table compares Intuit and SAP’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Intuit	21.91%	25.18%	13.79%
SAP	20.08%	17.31%	10.80%

Insider and Institutional Ownership

83.7% of Intuit shares are held by institutional investors. 2.5% of Intuit shares are held by company insiders. Comparatively, 7.3% of SAP shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Dividends

Intuit pays an annual dividend of $4.80 per share and has a dividend yield of 1.6%. SAP pays an annual dividend of $2.14 per share and has a dividend yield of 1.3%. Intuit pays out 29.1% of its earnings in the form of a dividend. SAP pays out 28.9% 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. Intuit has raised its dividend for 13 consecutive years. Intuit is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation and Earnings

This table compares Intuit and SAP”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Intuit	$18.83 billion	4.23	$3.87 billion	$16.51	17.63
SAP	$41.63 billion	4.70	$8.10 billion	$7.40	21.50

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

Summary

SAP beats Intuit on 10 of the 18 factors compared between the two stocks.

About Intuit

Intuit Inc. provides financial management and compliance products and services for consumers, small businesses, self-employed, and accounting professionals in the United States, Canada, and internationally. The company operates in four segments: Small Business & Self-Employed, Consumer, Credit Karma, and ProTax. The Small Business & Self-Employed segment provides QuickBooks services, that includes financial and business management online services and desktop software, payroll solutions, time tracking, merchant payment processing solutions, and financing for small businesses; and Mailchimp services, such as e-commerce, marketing automation, and customer relationship management. This segment also offers QuickBooks online services and desktop software solutions comprising QuickBooks Online Advanced, a cloud-based solution; QuickBooks Enterprise, a hosted solution; and QuickBooks Self-Employed solution; payment-processing solutions, including credit and debit cards, Apple Pay, and ACH payment services; and financial supplies and financing for small businesses, as well as electronic filing of federal and state income tax returns. The Consumer segment provides TurboTax income tax preparation products and services. The Credit Karma segment offers consumers with a personal finance platform that provides personalized recommendations of home, auto, and personal loans, as well as credit cards and insurance products. The ProTax segment provides Lacerte, ProSeries, and ProFile desktop tax-preparation software products; and ProConnect Tax Online tax products, electronic tax filing service, and bank products and related services. It sells products and services through various sales and distribution channels, including multi-channel shop-and-buy experiences, websites and call centers, mobile application stores, and retail and other channels. The company was founded in 1983 and is headquartered in Mountain View, California.

About SAP

SAP SE, together with its subsidiaries, provides applications, technology, and services worldwide. It offers SAP S/4HANA that provides software capabilities for finance, risk and project management, procurement, manufacturing, supply chain and asset management, and research and development; SAP SuccessFactors solutions for human resources, including HR and payroll, talent and employee experience management, and people and workforce analytics; and spend management solutions that covers direct and indirect spend, travel and expense, and external workforce management. The company also provides SAP customer experience solutions; SAP Business Technology platform that enables customers and partners to build, integrate, and automate applications; and SAP Business Network, a business-to-business collaboration platform that helps digitalize key business processes across the supply chain and enables communication between trading partners. In addition, it offers SAP Signavio to help customers to discover, analyze, and understand their business process operations; SAP's industry cloud solutions that provides modular solutions addressing industry-specific functions; Taulia solutions for working capital management to help enable customers mitigate the effects of inflation by providing visibility into working capital and access to liquidity; and sustainability solutions and services. SAP SE was founded in 1972 and is headquartered in Walldorf, Germany.