Virtusa Corporation (NASDAQ: VRTU) is one of 196 public companies in the “IT Services & Consulting” industry, but how does it contrast to its competitors? We will compare Virtusa Corporation to similar companies based on the strength of its valuation, dividends, institutional ownership, profitability, earnings, analyst recommendations and risk.

Institutional and Insider Ownership

92.1% of Virtusa Corporation shares are owned by institutional investors. Comparatively, 60.2% of shares of all “IT Services & Consulting” companies are owned by institutional investors. 6.0% of Virtusa Corporation shares are owned by insiders. Comparatively, 17.1% of shares of all “IT Services & Consulting” companies are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Risk and Volatility

Virtusa Corporation has a beta of 1.67, suggesting that its share price is 67% more volatile than the S&P 500. Comparatively, Virtusa Corporation’s competitors have a beta of 1.27, suggesting that their average share price is 27% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Virtusa Corporation and its competitors, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Virtusa Corporation 0 1 6 0 2.86
Virtusa Corporation Competitors 670 4381 7387 165 2.56

Virtusa Corporation currently has a consensus target price of $37.14, indicating a potential downside of 2.67%. As a group, “IT Services & Consulting” companies have a potential upside of 0.52%. Given Virtusa Corporation’s competitors higher possible upside, analysts plainly believe Virtusa Corporation has less favorable growth aspects than its competitors.

Profitability

This table compares Virtusa Corporation and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Virtusa Corporation 2.47% 4.26% 2.66%
Virtusa Corporation Competitors -20.69% -45.03% -3.99%

Valuation & Earnings

This table compares Virtusa Corporation and its competitors top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Virtusa Corporation $880.61 million $53.27 million 54.51
Virtusa Corporation Competitors $2.14 billion $366.36 million 15.85

Virtusa Corporation’s competitors have higher revenue and earnings than Virtusa Corporation. Virtusa Corporation is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Summary

Virtusa Corporation beats its competitors on 8 of the 13 factors compared.

About Virtusa Corporation

Virtusa Corporation (Virtusa) is an information technology services company. The Company’s services include information technology (IT) and business consulting, digital enablement services, user experience (UX) design, development of IT applications, maintenance and support services, systems integration, infrastructure and managed services. Its services enable its clients to accelerate business outcomes by consolidating, rationalizing and modernizing the clients’ core customer-facing processes into one or more core systems. It delivers solutions through a global delivery model, applying advanced methods, such as Agile, a technique designed to accelerate application development. The Company uses its consulting methodology, Accelerated Solution Design (ASD). It supports the Chief Information Officers (CIOs) of its client organizations in solving their critical issues, including managing total cost of ownership, accelerating time-to-market and increasing productivity.

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