Head to Head Review: PTC (NASDAQ:PTC) and The Descartes Systems Group (NASDAQ:DSGX)


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PTC (NASDAQ:PTC) and The Descartes Systems Group (NASDAQ:DSGX) are both computer and technology companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, analyst recommendations, valuation, institutional ownership, risk, earnings and dividends.

Institutional & Insider Ownership

88.4% of PTC shares are held by institutional investors. Comparatively, 77.3% of The Descartes Systems Group shares are held by institutional investors. 9.9% of PTC shares are held by insiders. Comparatively, 0.3% of The Descartes Systems Group shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for PTC and The Descartes Systems Group, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
PTC 0 4 13 0 2.76
The Descartes Systems Group 0 3 6 0 2.67

PTC presently has a consensus target price of $111.94, suggesting a potential downside of 10.10%. The Descartes Systems Group has a consensus target price of $64.44, suggesting a potential upside of 12.74%. Given The Descartes Systems Group’s higher probable upside, analysts clearly believe The Descartes Systems Group is more favorable than PTC.

Volatility & Risk

PTC has a beta of 1.22, suggesting that its share price is 22% more volatile than the S&P 500. Comparatively, The Descartes Systems Group has a beta of 1.2, suggesting that its share price is 20% more volatile than the S&P 500.

Earnings and Valuation

This table compares PTC and The Descartes Systems Group’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
PTC $1.26 billion 11.57 -$27.46 million $0.91 136.82
The Descartes Systems Group $325.79 million 14.82 $37.00 million $0.45 127.02

The Descartes Systems Group has lower revenue, but higher earnings than PTC. The Descartes Systems Group is trading at a lower price-to-earnings ratio than PTC, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares PTC and The Descartes Systems Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
PTC 6.21% 16.99% 6.51%
The Descartes Systems Group 13.64% 5.50% 4.77%

Summary

PTC beats The Descartes Systems Group on 10 of the 14 factors compared between the two stocks.

About PTC

PTC Inc. operates as software and services company in the Americas, Europe, and the Asia Pacific. The company operates in two segments, Software Products and Professional Services. It offers ThingWorx, an IIoT platform that enables customers to address digital transformation of their operations, products, and services; ThingWorx Solution Central, a centralized portal in the cloud that allows users of ThingWorx to discover, deploy, and manage ThingWorx applications; and ThingWorx Kepware, which enables users to connect, manage, monitor, and control disparate devices and software applications. The company also provides Vuforia Studio, a cloud-based tool that enables industrial enterprises to author and publish augmented reality (AR) experiences; Vuforia Expert Capture that chronicles the real-time movements of a person wearing an AR headset; Vuforia Engine technology for application development; Vuforia Chalk, a collaboration and remote assistance solution; and Vuforia Spatial Toolbox technology to accelerate the development of spatial computing prototypes and use cases. In addition, it offers Onshape, a cloud-native multi-tenant platform that unites computer-aided design with data management, collaboration tools, and real-time analytics; Creo, a suite of product design software, which provides capabilities for design, real-time simulation, additive manufacturing, design flexibility, advanced assembly design, piping and cabling design, advanced surfacing, virtual prototyping, and other design functions; and Windchill, a product lifecycle management software. Further, the company provides Integrity, an application lifecycle management solution; Servigistics, service parts management solution; and consulting, implementation, training, cloud, and license and support services. The company was formerly known as Parametric Technology Corporation and changed its name to PTC Inc. in January 2013. PTC Inc. was founded in 1985 and is headquartered in Boston, Massachusetts.

About The Descartes Systems Group

The Descartes Systems Group Inc. provides cloud, device, and data content-based solutions that focus on enhancing the productivity, performance, and security of logistics-intensive businesses worldwide. Its Logistics Technology platform combines a network, applications, content, and a community. The company provides a suite of solutions that include routing, mobile and telematics; transportation management and e-commerce fulfillment; customs and regulatory compliance; global trade data and services; global logistics network services; and broker and forwarder enterprise systems. The company offers its customers to use its modular, cloud-based and data content solutions to route, schedule, track, and measure delivery resources; plan, allocate, and execute shipments; rate, audit, and pay transportation invoices; access and analyze global trade data; research and perform trade tariff and duty calculations; file customs and security documents for imports and exports; comply with trade regulations, and various other logistics processes. It also act as a reseller of hardware devices in connection with transportation and logistics operations. The company primarily focuses on serving transportation providers, logistics service providers, manufacturers, retailers, distributors, and business service providers. The company was founded in 1981 and is headquartered in Waterloo, Canada.

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