Contrasting Conduent (NASDAQ:CNDT) & TaskUs (NASDAQ:TASK)

Conduent (NASDAQ:CNDT) and TaskUs (NASDAQ:TASK) are both small-cap industrials companies, but which is the superior business? We will contrast the two companies based on the strength of their risk, valuation, institutional ownership, earnings, dividends, profitability and analyst recommendations.

Volatility and Risk

Conduent has a beta of 1.45, meaning that its stock price is 45% more volatile than the S&P 500. Comparatively, TaskUs has a beta of 1.83, meaning that its stock price is 83% more volatile than the S&P 500.

Insider & Institutional Ownership

77.3% of Conduent shares are held by institutional investors. Comparatively, 44.6% of TaskUs shares are held by institutional investors. 1.9% of Conduent shares are held by company insiders. Comparatively, 31.9% of TaskUs shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent ratings for Conduent and TaskUs, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Conduent	1	1	0	1	2.33
TaskUs	1	5	1	1	2.25

TaskUs has a consensus target price of $9.60, indicating a potential upside of 17.94%. Given TaskUs’ higher possible upside, analysts plainly believe TaskUs is more favorable than Conduent.

Earnings and Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Conduent	$3.04 billion	0.08	-$170.00 million	($1.52)	-1.05
TaskUs	$1.23 billion	0.61	$102.28 million	$1.16	7.02

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

Profitability

This table compares Conduent and TaskUs’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Conduent	-8.17%	-9.02%	-2.43%
TaskUs	8.75%	27.02%	11.58%

Summary

TaskUs beats Conduent on 11 of the 14 factors compared between the two stocks.

About Conduent

Conduent Incorporated provides digital business solutions and services for the commercial, government, and transportation spectrum in the United States, Europe, and internationally. It operates through three segments: Commercial, Government Services, and Transportation. The Commercial segment offers business process services and customized solutions to clients in various industries; and customer experience management, business operations, healthcare claims and administration, and human capital solutions. The Government segment provides government-centric business process services to the United States federal, state, local, and foreign governments for public assistance, program administration, transaction processing, and payment services; and digital payments, child support payments, government healthcare, and eligibility and enrollment solutions. The Transportation segment offers systems, support, and revenue-generating solutions to government transportation agency clients; and public safety, mobility, and digital payment solutions. This segment also provides electronic tolling, urban congestion management, and mileage-based user solutions; transit solutions; citation and permit administration, parking enforcement, and curbside demand management solutions; and computer-aided dispatch/automatic vehicle location solutions. Conduent Incorporated was founded in 2016 and is headquartered in Florham Park, New Jersey.

About TaskUs

TaskUs, Inc. provides digital outsourcing services for companies in Philippines, the United States, India, and internationally. It offers digital customer experience that consists of omni-channel customer care services primarily delivered through non-voice digital channels; and other solutions, including experience and customer care services for new product or market launches, and customer acquisition solutions. The company also provides trust and safety solutions, such as review and disposition of user and advertiser generated visual, text, and audio content, which include removal or labeling of policy violating, and offensive or misleading content, as well as risk management, compliance, identity management, and fraud services; and artificial intelligence (AI) solutions that consist of data labeling, annotation, context relevance, and transcription services for training and tuning machine learning algorithms that enables to develop AI systems. It serves clients in various industry segments comprising e-commerce, FinTech, food delivery and ride sharing, gaming, technology, HealthTech, social media, and streaming media. The company was formerly known as TU TopCo, Inc. and changed its name to TaskUs, Inc. in December 2020. TaskUs, Inc. was founded in 2008 and is headquartered in New Braunfels, Texas.