RingCentral (NYSE:RNG) and Change Healthcare (NASDAQ:CHNG) are both computer and technology companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, dividends, institutional ownership, risk, valuation, earnings and analyst recommendations.

Earnings & Valuation

This table compares RingCentral and Change Healthcare’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
RingCentral $673.62 million 25.61 -$26.20 million ($0.04) -5,139.50
Change Healthcare N/A N/A N/A N/A N/A

Change Healthcare has lower revenue, but higher earnings than RingCentral.

Profitability

This table compares RingCentral and Change Healthcare’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
RingCentral -4.06% -1.61% -0.56%
Change Healthcare N/A N/A N/A

Analyst Recommendations

This is a summary of recent ratings and target prices for RingCentral and Change Healthcare, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
RingCentral 0 3 16 1 2.90
Change Healthcare 0 1 18 0 2.95

RingCentral presently has a consensus target price of $175.47, suggesting a potential downside of 14.64%. Change Healthcare has a consensus target price of $18.64, suggesting a potential upside of 20.10%. Given Change Healthcare’s stronger consensus rating and higher possible upside, analysts plainly believe Change Healthcare is more favorable than RingCentral.

Insider and Institutional Ownership

83.2% of RingCentral shares are owned by institutional investors. Comparatively, 93.0% of Change Healthcare shares are owned by institutional investors. 11.0% of RingCentral shares are owned by company insiders. Comparatively, 20.8% of Change Healthcare shares are owned 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.

Summary

Change Healthcare beats RingCentral on 8 of the 10 factors compared between the two stocks.

About RingCentral

RingCentral, Inc. provides software-as-a-service solutions that enable businesses to communicate, collaborate, and connect primarily in North America. The company's products include RingCentral Office, provides communication and collaboration across various modes, including high-definition voice, video, SMS, messaging and collaboration, conferencing, online meetings, and fax through smartphones, tablets, PCs, and desk phones; RingCentral Professional, a cloud based virtual telephone service for professionals, as well as provides inbound call answering and management services, and includes inbound local, long-distance, and toll-free minutes; and RingCentral Fax that provides online fax capabilities that allow businesses to send and receive fax documents without a fax machine. Its products also comprise RingCentral Contact Center, a collaborative contact center solution that delivers omni-channel; and RingCentral Glip, a team messaging and collaboration solution that allows a range of teams to stay connected through various modes of communication through an integration with RingCentral Office. The company serves a range of industries, including financial services, healthcare, legal services, real estate, retail, technology, insurance, construction, hospitality, and state and local government, as well as others. It sells its products through a network of direct sales representatives, as well as sales agents and channel partners. The company was incorporated in 1999 and is headquartered in Belmont, California.

About Change Healthcare

Change Healthcare Inc., an independent healthcare technology platform, provides data and analytics-driven solutions to improve clinical, financial, and patient engagement outcomes in the United States healthcare system. It operates in three segments: Software and Analytics, Network Solutions, and Technology-Enabled Services. The Software and Analytics segment provides software and analytics solutions for financial performance, payment accuracy, clinical decision management, value-based payment, provider and consumer engagement, and imaging and clinical workflow. The Network Solutions segment enables financial, administrative, and clinical transactions; electronic business-to-business and consumer-to-business payments; and aggregation and analytics of clinical and financial data. The Technology-Enabled Services segment provides solutions for financial and administrative management, value-based care, communication and payment, pharmacy benefits administration, and healthcare consulting. The company was founded in 2016 and is headquartered in Nashville, Tennessee. Change Healthcare Inc.(NasdaqGS:CHNG) operates independently of McKesson Corporation as of June 26, 2019.

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