Ability (NASDAQ: ABIL) and IMS Health Holdings (NYSE:IMS) are both computer and technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their valuation, analyst recommendations, profitabiliy, institutional ownership, risk, dividends and earnings.

Risk and Volatility

Ability has a beta of 0.6, indicating that its share price is 40% less volatile than the S&P 500. Comparatively, IMS Health Holdings has a beta of 0.83, indicating that its share price is 17% less volatile than the S&P 500.

Profitability

This table compares Ability and IMS Health Holdings’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ability -99.78% -75.37% -24.55%
IMS Health Holdings 2.99% 5.62% 1.22%

Valuation and Earnings

This table compares Ability and IMS Health Holdings’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Ability $10.84 million 1.68 -$8.63 million ($0.34) -2.08
IMS Health Holdings N/A N/A N/A $0.42 74.62

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

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Ability and IMS Health Holdings, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ability 0 1 0 0 2.00
IMS Health Holdings 0 0 0 0 N/A

Ability currently has a consensus price target of $1.30, suggesting a potential upside of 84.14%. Given Ability’s higher probable upside, equities analysts plainly believe Ability is more favorable than IMS Health Holdings.

Insider & Institutional Ownership

6.2% of Ability shares are held by institutional investors. Comparatively, 90.3% of IMS Health Holdings shares are held by institutional investors. 2.5% of IMS Health Holdings shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Summary

IMS Health Holdings beats Ability on 7 of the 9 factors compared between the two stocks.

Ability Company Profile

Ability Inc. is a holding company. The Company operates through its subsidiaries, Ability Computer & Software Industries Ltd. and Ability Security Systems Ltd., which provide interception, geolocation and cyber intelligence tools for security and intelligence agencies, military forces, law enforcement agencies and homeland security agencies around the world. The Company is engaged in off-air interception of voice, short message service (SMS), and data communication from both cellular and satellite communication networks, and deciphering solutions for both cellular and satellite communications. The Company’s product categories include Cellular Interception, Cellular Counter Interception, Satellite Interception, Geolocation, Cyber and Crime Prevention. Its Cellular Interception systems include Ultimate Interceptor (ULIN), IBIS, TouchDown, ACIS, AGIS-51 and 3G-Cat. Its Satellite Interception systems include IRIS, ATIS and SLIS.

IMS Health Holdings Company Profile

IMS Health Holdings, Inc. (IMS) is an information and technology services company that provides solutions to its clients in the healthcare industry. The Company has its presence in over 100 countries. The Company’s data set contains over 10 petabytes of data and over 500 million patient records. It serves healthcare organizations and life science companies, including pharmaceutical, biotechnology, consumer health and medical device manufacturers, as well as distributors, providers, payers, government agencies, policymakers, researchers and the financial community. The Company’s principal information offerings include national information offerings, sub-national information offerings and OneKey. Its technology services offerings include technology solutions, real-world evidence solutions, and workflow analytics and consulting services. It offers technology services that include data warehousing, information technology (IT) outsourcing, software applications and other services.

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