ExlService Holdings (NASDAQ: EXLS) and Vectrus (NYSE:VEC) are both business services companies, but which is the superior business? We will compare the two companies based on the strength of their analyst recommendations, profitability, risk, valuation, earnings, institutional ownership and dividends.

Valuation & Earnings

This table compares ExlService Holdings and Vectrus’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
ExlService Holdings $720.56 million 2.79 $101.10 million $1.97 30.27
Vectrus $1.12 billion 0.33 $45.00 million $1.90 17.42

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

Profitability

This table compares ExlService Holdings and Vectrus’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ExlService Holdings 9.53% 14.34% 11.04%
Vectrus 2.06% 18.96% 5.04%

Risk and Volatility

ExlService Holdings has a beta of 1.27, suggesting that its stock price is 27% more volatile than the S&P 500. Comparatively, Vectrus has a beta of 2.21, suggesting that its stock price is 121% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and price targets for ExlService Holdings and Vectrus, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ExlService Holdings 1 4 6 0 2.45
Vectrus 0 0 1 0 3.00

ExlService Holdings currently has a consensus target price of $59.45, suggesting a potential downside of 0.29%. Given ExlService Holdings’ higher possible upside, analysts clearly believe ExlService Holdings is more favorable than Vectrus.

Insider & Institutional Ownership

94.7% of ExlService Holdings shares are owned by institutional investors. Comparatively, 85.1% of Vectrus shares are owned by institutional investors. 5.8% of ExlService Holdings shares are owned by company insiders. Comparatively, 3.9% of Vectrus shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

ExlService Holdings beats Vectrus on 10 of the 14 factors compared between the two stocks.

ExlService Holdings Company Profile

ExlService Holdings, Inc. is an operations management and analytics company. The Company segments include Insurance; Healthcare; Travel, Transportation and Logistics; Finance and Accounting (F&A); Analytics, and All Other. The Insurance operating segment serves property and casualty insurance, life insurance, disability insurance, annuity and retirement services companies. The Healthcare operating segment serves healthcare payers and providers. The Travel, Transportation and Logistics operating segment primarily serves clients in the travel, transport and logistics industries. The F&A operating segment provides finance and accounting business process management (BPM) services across an array of F&A processes. The Analytics services focus on driving business outcomes for its customers by generating data-driven insights across all parts of its customers’ businesses. The All Other segment includes banking and financial services, utilities and consulting operating segments.

Vectrus Company Profile

Vectrus, Inc. is a provider of services to the United States Government across the world. The Company offers services, including infrastructure asset management, logistics and supply chain management, and information technology and network communication. Its infrastructure asset management services support the United States Army, Air Force and Navy, and include infrastructure services, security, warehouse management and distribution, ammunition management, civil engineering, air base maintenance and operations, communications, emergency services, transportation, and life support activities at various global military installations. Its logistics and supply chain management services support and maintain the vehicle and equipment stocks of the United States Army and Marine Corps. Its information technology and network communication services consist of sustainment of communications systems, network security, systems installation and life cycle management of information technology systems.

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