Financial Contrast: Paycom Software (PAYC) versus QAD (QADA)
Paycom Software (NYSE: PAYC) and QAD (NASDAQ:QADA) are both technology companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, dividends, profitability, analyst recommendations, earnings, valuation and risk.
This table compares Paycom Software and QAD’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Paycom Software has a beta of 1.67, indicating that its stock price is 67% more volatile than the S&P 500. Comparatively, QAD has a beta of 0.95, indicating that its stock price is 5% less volatile than the S&P 500.
Earnings & Valuation
This table compares Paycom Software and QAD’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Paycom Software||$329.14 million||16.45||$43.84 million||$1.06||87.68|
|QAD||$277.97 million||2.94||-$15.45 million||($1.03)||-41.21|
Paycom Software has higher revenue and earnings than QAD. QAD is trading at a lower price-to-earnings ratio than Paycom Software, indicating that it is currently the more affordable of the two stocks.
This is a summary of recent ratings and price targets for Paycom Software and QAD, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Paycom Software presently has a consensus price target of $85.50, indicating a potential downside of 8.01%. QAD has a consensus price target of $44.50, indicating a potential upside of 4.83%. Given QAD’s stronger consensus rating and higher probable upside, analysts clearly believe QAD is more favorable than Paycom Software.
Institutional & Insider Ownership
88.5% of Paycom Software shares are held by institutional investors. Comparatively, 44.8% of QAD shares are held by institutional investors. 17.9% of Paycom Software shares are held by company insiders. Comparatively, 44.1% of QAD shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
QAD pays an annual dividend of $0.14 per share and has a dividend yield of 0.3%. Paycom Software does not pay a dividend. QAD pays out -13.6% of its earnings in the form of a dividend.
Paycom Software beats QAD on 11 of the 16 factors compared between the two stocks.
About Paycom Software
Paycom Software, Inc. is a provider of a cloud-based human capital management (HCM) software solution delivered as Software-as-a-Service (SaaS). The Company provides functionality and data analytics that businesses need to manage the complete employment life cycle from recruitment to retirement. The Company’s applications streamline client processes and provide clients and their employees with the ability to directly access and manage administrative processes, including applications that identify candidates, on-board employees, manage time and labor, administer payroll deductions and benefits, manage performance, terminate employees and administer post-termination health benefits, such as COBRA. The Company’s solution allows clients to analyze employee information to make business decisions. The Company’s HCM solution offers a range of applications, including talent acquisition, time and labor management, payroll, talent management and human resources (HR) management.
QAD Inc. (QAD) is a provider of vertically oriented enterprise software solutions for global manufacturing companies across the automotive, life sciences, consumer products, food and beverage, high technology and industrial products industries. QAD Enterprise Applications enables measurement and control of business processes and supports operational requirements, including financials, manufacturing, demand and supply chain planning, customer management, business intelligence and business process management. QAD delivers components of its solution for a range of mobile platforms. The Company’s mobile suite includes a requisition approval solution, a mobile business intelligence solution, mobile browse capability and mobile application monitoring tools to support system administrators. Its mobile browse capability allows users to view, filter and sort data accessible through QAD Browses within QAD Enterprise Applications using mobile devices.
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