Fujitsu (OTCMKTS:FJTSY) vs. Science Applications International (NASDAQ:SAIC) Critical Contrast

Science Applications International (NASDAQ:SAIC) and Fujitsu (OTCMKTS:FJTSY) are both computer and technology companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, dividends, analyst recommendations, risk, profitability, valuation and earnings.

Insider & Institutional Ownership

76.0% of Science Applications International shares are held by institutional investors. Comparatively, 0.1% of Fujitsu shares are held by institutional investors. 0.4% of Science Applications International shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Science Applications International and Fujitsu’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Science Applications International	5.05%	33.19%	9.62%
Fujitsu	N/A	N/A	N/A

Analyst Ratings

This is a summary of recent recommendations and price targets for Science Applications International and Fujitsu, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Science Applications International	1	7	3	0	2.18
Fujitsu	0	1	0	0	2.00

Science Applications International presently has a consensus target price of $116.44, suggesting a potential upside of 26.69%. Given Science Applications International’s stronger consensus rating and higher probable upside, equities analysts clearly believe Science Applications International is more favorable than Fujitsu.

Earnings & Valuation

This table compares Science Applications International and Fujitsu”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Science Applications International	$7.48 billion	0.55	$362.00 million	$7.82	11.75
Fujitsu	$23.31 billion	N/A	$1.45 billion	$0.45	49.31

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

Dividends

Science Applications International pays an annual dividend of $1.48 per share and has a dividend yield of 1.6%. Fujitsu pays an annual dividend of $0.12 per share and has a dividend yield of 0.5%. Science Applications International pays out 18.9% of its earnings in the form of a dividend. Fujitsu pays out 26.7% 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. Science Applications International is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk & Volatility

Science Applications International has a beta of 0.31, suggesting that its share price is 69% less volatile than the S&P 500. Comparatively, Fujitsu has a beta of 0.89, suggesting that its share price is 11% less volatile than the S&P 500.

Summary

Science Applications International beats Fujitsu on 11 of the 15 factors compared between the two stocks.

About Science Applications International

Science Applications International Corporation provides technical, engineering, and enterprise information technology (IT) services primarily in the United States. The company’s offerings include engineering; technology integration; IT modernization; maintenance of ground and maritime systems; logistics; training and simulation; operation and program support services; and end-to-end services, such as design, development, integration, deployment, management and operations, sustainment, and security of its customers’ IT infrastructure, as well as cloud migration, managed services, infrastructure modernization, and enterprise IT-as-a-service solutions. It serves the U.S. military comprising Army, Air Force, Navy, Marines, and Coast Guard; Department of Defense agencies; National Aeronautics and Space Administration; the U.S. Department of State; Department of Justice; Department of Homeland Security; and various intelligence community agencies, as well as U.S. federal civilian agencies. The company was formerly known as SAIC Gemini, Inc. and changed its name to Science Applications International Corporation in September 2013. Science Applications International Corporation was founded in 1969 and is headquartered in Reston, Virginia.

About Fujitsu

Fujitsu Limited operates as an information and communication technology company in Japan and internationally. The company operates through three segments: Technology Solutions, Ubiquitous Solutions, and Device Solutions. The company offers multi cloud and hybrid IT services; assessment and consultative services; SAP landscape transformation services; new workplace; datacentre products comprising integrated systems, storage solutions, servers, network switches, and infrastructure management; workplace products including notebooks, tablet PC’s, desktop PC’s, workstations, thin clients, displays, and peripheral devices; consumption based IT services; installation and implementation services; and hardware, software, and infrastructure support services, as well as electronic devices, air conditioning products, and network solutions. It also provides cyber security solutions, including cyber security consulting, managed security servies, and security operation and advanced threat centers; internet of things, artificial intelligence platform and solutions; and software products comprising FUJITSU Software Infrastructure Manager and FUJITSU Software ServerView Suite. Further, the company offers electronic components, such as semiconductor packages and batteries. It serves automotive, manufacturing, retail, financial services, transport, telecommunications, healthcare, and energy and utilities industries; the public sectors; and services providers. The company was founded in 1923 and is headquartered in Tokyo, Japan.