Critical Comparison: Descartes Systems Group (NASDAQ:DSGX) & Benefitfocus (NASDAQ:BNFT)
Descartes Systems Group (NASDAQ:DSGX) and Benefitfocus (NASDAQ:BNFT) are both computer and technology companies, but which is the better business? We will contrast the two businesses based on the strength of their profitability, risk, dividends, earnings, institutional ownership, analyst recommendations and valuation.
Insider & Institutional Ownership
79.4% of Descartes Systems Group shares are held by institutional investors. Comparatively, 96.7% of Benefitfocus shares are held by institutional investors. 0.3% of Descartes Systems Group shares are held by insiders. Comparatively, 9.7% of Benefitfocus shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
This is a summary of current recommendations and price targets for Descartes Systems Group and Benefitfocus, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Descartes Systems Group||0||5||5||0||2.50|
Descartes Systems Group currently has a consensus target price of $45.20, suggesting a potential downside of 3.42%. Benefitfocus has a consensus target price of $38.67, suggesting a potential upside of 119.45%. Given Benefitfocus’ stronger consensus rating and higher possible upside, analysts plainly believe Benefitfocus is more favorable than Descartes Systems Group.
Earnings & Valuation
This table compares Descartes Systems Group and Benefitfocus’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Descartes Systems Group||$275.17 million||14.31||$31.28 million||$0.40||117.00|
|Benefitfocus||$258.72 million||2.23||-$52.63 million||($1.49)||-11.83|
Descartes Systems Group has higher revenue and earnings than Benefitfocus. Benefitfocus is trading at a lower price-to-earnings ratio than Descartes Systems Group, indicating that it is currently the more affordable of the two stocks.
This table compares Descartes Systems Group and Benefitfocus’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Descartes Systems Group||10.70%||4.98%||3.89%|
Volatility & Risk
Descartes Systems Group has a beta of 0.69, indicating that its stock price is 31% less volatile than the S&P 500. Comparatively, Benefitfocus has a beta of 1.19, indicating that its stock price is 19% more volatile than the S&P 500.
Descartes Systems Group beats Benefitfocus on 8 of the 13 factors compared between the two stocks.
About Descartes Systems Group
The Descartes Systems Group Inc. provides federated network and logistics technology solutions worldwide. Its Logistics Application Suite offers a range of modular, cloud-based, and interoperable Web and wireless logistics management applications. The company's Logistics Application Suite offers solutions, such as route planning and execution, mobile applications, and telematics and compliance; transportation management solutions comprising carrier compliance and rate management, freight audit and settlement, dock scheduling and yard management, pool distribution, transportation planning and execution, and logistics flow control, as well as visibility, tracking, and performance management; and global logistics network services, such as document management, community, and connectivity services. Its Logistics Application Suite solutions also include customs and regulatory compliance solutions, such as cargo security compliance, declaration and fiscal compliance, customs warehouse management, ocean regulatory services, industry program support services, global trade content, and government solutions; and broker and forwarder enterprise system solutions, such as forwarder back office, and brokerage and declaration services. In addition, the company offers consulting, implementation, and training services; and maintenance and support services. It serves transportation providers, logistics service providers, and distribution-intensive companies through distributors, alliance partners, and value added resellers. The company was founded in 1981 and is headquartered in Waterloo, Canada.
Benefitfocus, Inc. provides cloud-based benefits management platform for consumers, employers, insurance carriers, suppliers, and brokers in the United States. The company operates through Employer and Carrier segments. Its products for insurance carriers include BenefitsPlace, a transaction-oriented, marketplace solution; eEnrollment that provides online enrollment for benefits; eBilling, an electronic invoice presentment and payment solution; eExchange, a solution that bridges the integration gap between carrier and employer systems; eSales for carriers and brokers tools to organize and manage accounts, track leads, generate quotes, and create proposals for various products; and Core & Advanced Analytics, a data analytics solution. The company's products for employers include Benefitfocus Marketplace that streamlines online enrollment, employee communication, and benefit administration; ACA Management and Reporting, a solution for employers to manage ACA compliance; Consolidated Billing & Payment, an application that synchronizes enrollment and billing information to streamline the monthly billing process, automate adjustments, and enhance accuracy of payments; Consumer-Directed Healthcare Accounts, a solution for health savings accounts management; and COBRA Administration, a solution for employers that simplifies management of Consolidated Omnibus Budget Reconciliation Act, benefits. In addition, it provides professional and customer support services, which include implementation services, such as discovery, configuration and deployment, integration, testing, training, and technical support; and fulfillment, dependent verification, and HR administration services. The company was founded in 2000 and is headquartered in Charleston, South Carolina.
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