iPass (NASDAQ: CSGS) and CSG Systems International (NASDAQ:CSGS) are both small-cap computer and technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their dividends, institutional ownership, valuation, earnings, analyst recommendations, profitability and risk.

Analyst Recommendations

This is a summary of recent ratings for iPass and CSG Systems International, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
iPass 0 0 3 0 3.00
CSG Systems International 0 0 2 0 3.00

iPass currently has a consensus target price of $1.47, indicating a potential upside of 505.81%. CSG Systems International has a consensus target price of $51.00, indicating a potential upside of 34.46%. Given iPass’ higher possible upside, research analysts clearly believe iPass is more favorable than CSG Systems International.

Dividends

CSG Systems International pays an annual dividend of $0.84 per share and has a dividend yield of 2.2%. iPass does not pay a dividend. CSG Systems International pays out 41.6% of its earnings in the form of a dividend. CSG Systems International has increased its dividend for 4 consecutive years.

Profitability

This table compares iPass and CSG Systems International’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
iPass -40.13% -130,046.80% -105.22%
CSG Systems International 7.16% 21.86% 8.27%

Volatility and Risk

iPass has a beta of 0.13, indicating that its stock price is 87% less volatile than the S&P 500. Comparatively, CSG Systems International has a beta of 0.87, indicating that its stock price is 13% less volatile than the S&P 500.

Valuation & Earnings

This table compares iPass and CSG Systems International’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
iPass $54.40 million 0.37 -$20.55 million ($0.31) -0.78
CSG Systems International $789.58 million 1.61 $61.36 million $2.02 18.78

CSG Systems International has higher revenue and earnings than iPass. iPass is trading at a lower price-to-earnings ratio than CSG Systems International, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

19.4% of iPass shares are owned by institutional investors. Comparatively, 93.9% of CSG Systems International shares are owned by institutional investors. 8.2% of iPass shares are owned by company insiders. Comparatively, 2.2% of CSG Systems International shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Summary

CSG Systems International beats iPass on 12 of the 16 factors compared between the two stocks.

iPass Company Profile

iPass Inc. provides mobile connectivity that enables Wi-Fi access on various mobile devices in the United States and internationally. It offers mobile connectivity services that provide cloud-based solution allowing customers and their users access to its Wi-Fi network to stay connected to the people and information. The company provides business to business mobile connectivity solutions to large and small enterprises, as well as to strategic partnerships comprising original equipment manufacturers, loyalty programs, software product and service providers, and communication companies; and iPass SmartConnect that takes the guesswork out of Wi-Fi automatically connecting customers to the hotspot for their needs. It operates hotspots at airports, hotels, train stations, convention centers, outdoor venues, inflight, and others. The company sells its services directly through its global sales force, as well as through reseller and strategic partners. iPass Inc. was founded in 1996 and is headquartered in Redwood Shores, California.

CSG Systems International Company Profile

CSG Systems International, Inc. provides business support solutions primarily to the communications industry in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company's services include Advanced Convergent Platform, a billing and customer care platform for cable and satellite providers; Ascendon, a software-as-a-service cloud-based platform that provides a trusted path to digital transformation; and Singleview solution to deliver real-time charging services. Its solutions also comprise customer communications management solutions, which process interactive voice, SMS/text, print, e-mail, Web, and fax messages on behalf of clients; managed services; Total Service Mediation (TSM) framework that supports offline and real-time mediation requirements; and Wholesale Business Management Solution (WBMS), a settlements system, which handles voice, data, and content services. The company also offers professional services to implement, configure, and maintain software products, as well as licenses software products, such as WBMS, TSM, and Singleview products. CSG Systems International, Inc. was founded in 1994 and is headquartered in Greenwood Village, Colorado.

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