NEC (OTCMKTS:NIPNF) vs. Infosys (NYSE:INFY) Head-To-Head Analysis

Infosys (NYSE:INFY) and NEC (OTCMKTS:NIPNF) are both technology companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, analyst recommendations, risk, profitability, earnings, institutional ownership and dividends.

Volatility and Risk

Infosys has a beta of 0.88, suggesting that its share price is 12% less volatile than the S&P 500. Comparatively, NEC has a beta of -0.47, suggesting that its share price is 147% less volatile than the S&P 500.

Earnings and Valuation

This table compares Infosys and NEC”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Infosys	$20.30 billion	2.47	$3.31 billion	$0.81	15.29
NEC	$25.69 billion	0.32	$412.83 million	$1.64	19.51

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

Insider & Institutional Ownership

16.2% of Infosys shares are owned by institutional investors. 22.4% of Infosys shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Infosys and NEC’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Infosys	16.38%	33.91%	20.54%
NEC	N/A	N/A	N/A

Analyst Recommendations

This is a summary of current ratings and price targets for Infosys and NEC, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Infosys	2	8	0	0	1.80
NEC	0	0	0	0	0.00

Infosys currently has a consensus price target of $11.63, indicating a potential downside of 6.09%. Given Infosys’ stronger consensus rating and higher probable upside, research analysts clearly believe Infosys is more favorable than NEC.

Summary

Infosys beats NEC on 10 of the 13 factors compared between the two stocks.

About Infosys

Infosys Ltd. is a digital services and consulting company, which engages in the provision of end-to-end business solutions. It operates through the following segments: Financial Services, Retail, Communication, Energy, Utilities, Resources, and Services, Manufacturing, Hi-Tech, Life Sciences, and All Other. The company was founded by Dinesh Krishnan Swamy, Senapathy Gopalakrishnan, Narayana Ramarao Nagavara Murthy, Raghavan N. S., Ashok Arora, Nandan M. Nilekani, and S. D. Shibulal on July 2, 1981 and is headquartered in Bangalore, India.

About NEC

NEC Corporation provides information and communication technology solutions in Japan and internationally. It operates through five segments: Public Solutions Business, Public Infrastructure Business, Enterprise Business, Network Services Business, and Global Business. It provides systems integration services, including systems implementation and consulting; maintenance and support services; outsourcing and cloud services; and system equipment. The company also offers network infrastructure products comprising core network equipment, mobile phone base stations, optical transmission systems, and routers and switches; and services and management solutions, such as operation support system (OSS), business support system (BSS), and services. In addition, it provides digital government and digital finance solutions; software services for service providers, including OSS/BSS; and network infrastructure comprising submarine systems and wireless backhaul. Further, the company offers business computers, servers, NEC HPC solutions, and thin client solutions; data storage solutions; embedded systems; fiber optic devices; CONNEXIVE, an IoT platform software; PASOLINK, a mobile backhaul; optical fiber sensing products; submarine systems; and open optical transport products. Additionally, it provides EXPRESSCLUSTER X, a BC/DR solutions; NIAS, a solution for file server management; ERP solutions; MasterScope, an integrated administration software suite; Obbligato, a product lifecycle management; SaaS Solutions; WebOTX, a service execution platform; and unified communications and collaboration solutions. It serves aerospace, agriculture, aviation, broadcasting, finance, government, healthcare, hospitality, logistics, manufacturing, retail, telecom, and transportation industries. The company was formerly known as Nippon Electric Company, Limited and changed its name to NEC Corporation in April 1983. NEC Corporation was incorporated in 1899 and is headquartered in Tokyo, Japan.