Amdocs Limited (NASDAQ: DOX) and NCI (NASDAQ:NCIT) are both computer and technology companies, but which is the better business? We will compare the two businesses based on the strength of their valuation, risk, earnings, profitability, institutional ownership, dividends and analyst recommendations.

Analyst Ratings

This is a summary of current ratings for Amdocs Limited and NCI, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Amdocs Limited 0 4 3 0 2.43
NCI 0 3 1 0 2.25

Amdocs Limited currently has a consensus price target of $66.57, indicating a potential upside of 4.61%. NCI has a consensus price target of $18.33, indicating a potential downside of 8.33%. Given Amdocs Limited’s stronger consensus rating and higher probable upside, research analysts plainly believe Amdocs Limited is more favorable than NCI.

Insider & Institutional Ownership

90.0% of Amdocs Limited shares are owned by institutional investors. Comparatively, 39.1% of NCI shares are owned by institutional investors. 15.4% of Amdocs Limited shares are owned by insiders. Comparatively, 45.4% of NCI shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Amdocs Limited and NCI’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Amdocs Limited $3.83 billion 2.42 $712.62 million $2.87 22.17
NCI $325.44 million 0.83 $29.65 million $0.49 40.82

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

Profitability

This table compares Amdocs Limited and NCI’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Amdocs Limited 11.11% 14.73% 9.76%
NCI 1.79% 10.77% 7.80%

Dividends

Amdocs Limited pays an annual dividend of $0.88 per share and has a dividend yield of 1.4%. NCI does not pay a dividend. Amdocs Limited pays out 30.7% of its earnings in the form of a dividend.

Volatility & Risk

Amdocs Limited has a beta of 0.54, meaning that its stock price is 46% less volatile than the S&P 500. Comparatively, NCI has a beta of 1.01, meaning that its stock price is 1% more volatile than the S&P 500.

Summary

Amdocs Limited beats NCI on 12 of the 16 factors compared between the two stocks.

Amdocs Limited Company Profile

Amdocs Limited is a provider of software and services for communications, entertainment and media industry service providers. The Company develops, implements and manages software and services associated with business support systems (BSS), operational support systems (OSS) and network operations to enable service providers to introduce new products and services, process orders, monetize data, support new business models and enhance their understanding of their customers. The Company’s segment provides software products and services. Its services include strategic business consulting, systems integration and transformation, managed services and testing. Its managed services provide multi-year, flexible and tailored business processes and applications services, including application development and maintenance, information technology (IT) and infrastructure services, testing and professional services.

NCI Company Profile

NCI, Inc. is a provider of enterprise services and solutions to defense, intelligence, healthcare and civilian government agencies. The Company provides information technology (IT), and professional services and solutions by leveraging its core service offerings, which include cloud computing and IT infrastructure optimization; cybersecurity and information assurance; engineering and logistics support; enterprise information management and advanced analytics; health IT and medical support; IT service management; modeling, simulation, and training, and agile development and integration. The Company helps its clients to navigate the range of cloud, Everything-as-a-Service (EaaS), capacity services and virtualization options available. The Company provides its customers the full lifecycle of cybersecurity services, including policy and planning, compliance, identity and access management, training, education, awareness and enterprise security operations.

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