Head-To-Head Comparison: Infosys (NYSE:INFY) and GDS (NASDAQ:GDS)

GDS (NASDAQ:GDS) and Infosys (NYSE:INFY) are both technology companies, but which is the superior stock? We will contrast the two companies based on the strength of their risk, analyst recommendations, valuation, profitability, dividends, institutional ownership and earnings.

Profitability

This table compares GDS and Infosys’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
GDS	30.70%	17.94%	6.11%
Infosys	16.38%	33.91%	20.54%

Risk and Volatility

GDS has a beta of 0.42, indicating that its share price is 58% less volatile than the S&P 500. Comparatively, Infosys has a beta of 0.88, indicating that its share price is 12% less volatile than the S&P 500.

Insider and Institutional Ownership

33.7% of GDS shares are owned by institutional investors. Comparatively, 16.2% of Infosys shares are owned by institutional investors. 8.0% of GDS shares are owned by insiders. Comparatively, 22.4% of Infosys shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Earnings & Valuation

This table compares GDS and Infosys”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
GDS	$1.63 billion	3.80	$132.10 million	$2.15	14.40
Infosys	$20.16 billion	2.16	$3.31 billion	$0.81	13.26

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

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for GDS and Infosys, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
GDS	0	2	3	1	2.83
Infosys	1	10	0	0	1.91

GDS presently has a consensus price target of $48.12, suggesting a potential upside of 55.37%. Infosys has a consensus price target of $11.45, suggesting a potential upside of 6.65%. Given GDS’s stronger consensus rating and higher possible upside, analysts plainly believe GDS is more favorable than Infosys.

Summary

GDS beats Infosys on 9 of the 15 factors compared between the two stocks.

About GDS

GDS Holdings Limited, together with its subsidiaries, develops and operates data centers in the People's Republic of China. The company provides colocation services comprising critical facilities space, customer-available power, racks, and cooling; managed hosting services, including business continuity and disaster recovery, network management, data storage, system security, operating system, database, and server middleware services; managed cloud services; and consulting services. It serves cloud service providers, large Internet companies, financial institutions, telecommunications and IT service providers, and large domestic private sector and multinational corporations. GDS Holdings Limited was founded in 2001 and is headquartered in Shanghai, the People's Republic of China.

About Infosys

Infosys Ltd. is a digital services and consulting company, which engages in the provision of end-to-end business solutions. It operates through the following segments: Financial Services, Retail, Communication, Energy, Utilities, Resources, and Services, Manufacturing, Hi-Tech, Life Sciences, and All Other. The company was founded by Dinesh Krishnan Swamy, Senapathy Gopalakrishnan, Narayana Ramarao Nagavara Murthy, Raghavan N. S., Ashok Arora, Nandan M. Nilekani, and S. D. Shibulal on July 2, 1981 and is headquartered in Bangalore, India.