Aspen Technology (NASDAQ: AZPN) is one of 187 public companies in the “IT Services & Consulting” industry, but how does it contrast to its competitors? We will compare Aspen Technology to related businesses based on the strength of its dividends, institutional ownership, earnings, valuation, analyst recommendations, profitability and risk.

Insider & Institutional Ownership

63.0% of shares of all “IT Services & Consulting” companies are held by institutional investors. 0.8% of Aspen Technology shares are held by insiders. Comparatively, 15.9% of shares of all “IT Services & Consulting” companies are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Aspen Technology and its competitors revenue, earnings per share (EPS) and valuation.

Gross Revenue NetIncome Price/Earnings Ratio
Aspen Technology $482.94 million $162.19 million 30.65
Aspen Technology Competitors $2.79 billion $290.83 million 706.40

Aspen Technology’s competitors have higher revenue and earnings than Aspen Technology. Aspen Technology is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Analyst Recommendations

This is a summary of recent ratings for Aspen Technology and its competitors, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Aspen Technology 0 5 3 0 2.38
Aspen Technology Competitors 722 4626 7375 166 2.54

Aspen Technology presently has a consensus price target of $61.88, suggesting a potential downside of 6.11%. As a group, “IT Services & Consulting” companies have a potential upside of 5.54%. Given Aspen Technology’s competitors stronger consensus rating and higher probable upside, analysts plainly believe Aspen Technology has less favorable growth aspects than its competitors.

Profitability

This table compares Aspen Technology and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Aspen Technology 33.35% -66.74% 67.34%
Aspen Technology Competitors -14.10% -252.35% -2.64%

Volatility and Risk

Aspen Technology has a beta of 1.23, meaning that its stock price is 23% more volatile than the S&P 500. Comparatively, Aspen Technology’s competitors have a beta of 1.12, meaning that their average stock price is 12% more volatile than the S&P 500.

Summary

Aspen Technology competitors beat Aspen Technology on 9 of the 13 factors compared.

About Aspen Technology

Aspen Technology, Inc. is a global provider of process optimization software solutions designed to manage and optimize plant and process design, operational performance, and supply chain planning. The Company’s aspenONE software and related services have been developed specifically for companies in the process industries, including the energy, chemicals, and engineering and construction industries. It operates through two segments, including subscription and software, which provides licensing of process optimization software solutions and associated support services, and services, which includes professional services and training. It has developed applications to design and optimize processes across the business areas, including engineering, manufacturing and supply chain. Its products include Aspen HYSYS, Aspen Economic Evaluation, Aspen Info Plus.21, Aspen PIMS Advanced Optimization, Aspen Collaborative Demand Manager and Aspen Supply Planner.

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