WNS (Holdings) Limited (NYSE: WNS) and Maximus (NYSE:MMS) are both business services companies, but which is the superior business? We will contrast the two businesses based on the strength of their valuation, profitabiliy, institutional ownership, earnings, dividends, risk and analyst recommendations.

Profitability

This table compares WNS (Holdings) Limited and Maximus’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
WNS (Holdings) Limited 6.27% 19.10% 13.53%
Maximus 8.18% 26.21% 15.17%

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for WNS (Holdings) Limited and Maximus, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
WNS (Holdings) Limited 0 0 10 0 3.00
Maximus 0 5 1 0 2.17

WNS (Holdings) Limited currently has a consensus price target of $34.67, indicating a potential upside of 5.79%. Maximus has a consensus price target of $61.33, indicating a potential downside of 4.55%. Given WNS (Holdings) Limited’s stronger consensus rating and higher probable upside, analysts plainly believe WNS (Holdings) Limited is more favorable than Maximus.

Insider and Institutional Ownership

88.5% of WNS (Holdings) Limited shares are owned by institutional investors. Comparatively, 98.7% of Maximus shares are owned by institutional investors. 3.1% of Maximus shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares WNS (Holdings) Limited and Maximus’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
WNS (Holdings) Limited $602.50 million 2.72 $90.18 million $0.72 45.51
Maximus $2.47 billion 1.69 $384.91 million $3.07 20.93

Maximus has higher revenue and earnings than WNS (Holdings) Limited. Maximus is trading at a lower price-to-earnings ratio than WNS (Holdings) Limited, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

WNS (Holdings) Limited has a beta of 0.87, meaning that its stock price is 13% less volatile than the S&P 500. Comparatively, Maximus has a beta of 1.45, meaning that its stock price is 45% more volatile than the S&P 500.

Dividends

Maximus pays an annual dividend of $0.18 per share and has a dividend yield of 0.3%. WNS (Holdings) Limited does not pay a dividend. Maximus pays out 5.9% of its earnings in the form of a dividend.

Summary

Maximus beats WNS (Holdings) Limited on 10 of the 16 factors compared between the two stocks.

About WNS (Holdings) Limited

WNS (Holdings) Limited is a global provider of business process management (BPM) services. The Company offers data, voice, analytical and business transformation services. The Company’s segments include WNS Global BPM and WNS Auto Claims BPM. Its operating segments include travel, insurance, banking and financial services, healthcare, utilities, retail and consumer products groups, auto claims and others. The WNS Global BPM includes the Company’s business activities with the exception of WNS Auto Claims BPM. WNS Auto Claims BPM is the Company’s automobile claims management business. The Company focuses on various industry verticals, such as insurance; travel and leisure; diversified businesses, including manufacturing, retail, consumer packaged goods (CPG), media and entertainment, and telecommunication (telecom); utilities; consulting and professional services; banking and financial services; healthcare, and shipping and logistics.

About Maximus

MAXIMUS, Inc. provides business process services (BPS) to government health and human services agencies. The Company operates through three segments: U.S. Federal Services, Health Services and Human Services. The U.S. Federal Services segment provides BPS and program management for large government programs, independent health review and appeals services for both the United States Federal Government, and state-based programs and technology solutions for civilian federal programs. The Health Services segment provides a range of BPS, as well as related consulting services, for state, provincial and national government programs. The Human Services segment provides national, state and local human services agencies with a range of BPS and related consulting services for welfare-to-work, child support, higher education and K-12 special education programs.

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