IHS (NYSE: IHS) and FactSet Research Systems (NYSE:FDS) are both industrials companies, but which is the better business? We will contrast the two companies based on the strength of their earnings, institutional ownership, dividends, analyst recommendations, profitabiliy, valuation and risk.

Analyst Ratings

This is a summary of recent recommendations and price targets for IHS and FactSet Research Systems, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
IHS 0 2 1 0 2.33
FactSet Research Systems 3 7 1 0 1.82

IHS presently has a consensus price target of $44.67, suggesting a potential downside of 61.90%. FactSet Research Systems has a consensus price target of $165.00, suggesting a potential upside of 1.83%. Given FactSet Research Systems’ higher possible upside, analysts clearly believe FactSet Research Systems is more favorable than IHS.

Institutional and Insider Ownership

94.3% of FactSet Research Systems shares are held by institutional investors. 2.7% of FactSet Research Systems shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Risk and Volatility

IHS has a beta of 0.96, meaning that its share price is 4% less volatile than the S&P 500. Comparatively, FactSet Research Systems has a beta of 0.95, meaning that its share price is 5% less volatile than the S&P 500.

Valuation & Earnings

This table compares IHS and FactSet Research Systems’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
IHS N/A N/A N/A $3.58 32.75
FactSet Research Systems $1.18 billion 5.42 $410.94 million $8.55 18.95

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

Profitability

This table compares IHS and FactSet Research Systems’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
IHS 7.63% 8.19% 2.73%
FactSet Research Systems 29.02% 55.72% 25.28%

Dividends

FactSet Research Systems pays an annual dividend of $2.24 per share and has a dividend yield of 1.4%. IHS does not pay a dividend. FactSet Research Systems pays out 26.2% of its earnings in the form of a dividend. FactSet Research Systems has increased its dividend for 11 consecutive years.

Summary

FactSet Research Systems beats IHS on 10 of the 13 factors compared between the two stocks.

IHS Company Profile

IHS Inc. develops source of information, insight and analytics in different areas of business. The Company’s segments include Resources, Transportation and Consolidated Markets & Solutions. The Company’s Resources segment includes its Energy and Chemicals product offerings. Its Transportation segment includes its Automotive; Maritime & Trade, and Aerospace, Defense & Security product offerings. Its Consolidated Markets & Solutions segment includes its Product Design; Technology, Media & Telecom, and Economics & Country Risk product offerings. It provides authoritative analysis and forecasts of sales and production for light vehicles, medium and heavy commercial vehicles, powertrain, components and technology systems across various markets. Its product design offerings include content and analysis on various engineering and technical standards, codes, reference books, journals, and other scientific and technical documents, as well as software-based engineering decision engines.

FactSet Research Systems Company Profile

Factset Research Systems Inc. is engaged in providing integrated financial information and big data analytical applications for the global investment community. The Company’s segments include the U.S., Europe and Asia Pacific. The U.S. segment services finance professionals, including financial institutions throughout the Americas. The European segment maintains offices in France, Germany, Italy, Ireland, Latvia, Luxembourg, the Netherlands, Spain, South Africa, Sweden and Dubai. The Asia Pacific segment maintains office locations in Australia, Hong Kong, Singapore and Mumbai, India. The Company delivers insight and information to investment professionals through its analytics, service, content, and technology. Its offerings include a complete services solution focused on verifying, cleaning and loading portfolio data across asset classes, and an execution management system. The Company offers third-party content through desktop, wireless and off-platform solutions.

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