Aspen Technology (NASDAQ: AZPN) is one of 196 publicly-traded companies in the “IT Services & Consulting” industry, but how does it contrast to its peers? We will compare Aspen Technology to related companies based on the strength of its risk, earnings, profitability, analyst recommendations, dividends, institutional ownership and valuation.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Aspen Technology and its peers, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Aspen Technology 0 4 3 0 2.43
Aspen Technology Competitors 675 4408 7417 166 2.56

Aspen Technology presently has a consensus target price of $60.71, indicating a potential downside of 5.97%. As a group, “IT Services & Consulting” companies have a potential upside of 0.09%. Given Aspen Technology’s peers stronger consensus rating and higher possible upside, analysts plainly believe Aspen Technology has less favorable growth aspects than its peers.

Earnings and Valuation

This table compares Aspen Technology and its peers gross revenue, earnings per share and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Aspen Technology $482.94 million $218.97 million 30.46
Aspen Technology Competitors $2.12 billion $367.66 million 16.53

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

Institutional & Insider Ownership

60.5% of shares of all “IT Services & Consulting” companies are held by institutional investors. 0.6% of Aspen Technology shares are held by insiders. Comparatively, 16.9% of shares of all “IT Services & Consulting” companies are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Aspen Technology and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Aspen Technology 33.58% -73.17% 61.84%
Aspen Technology Competitors -20.80% -50.55% -4.24%

Risk & Volatility

Aspen Technology has a beta of 1.24, indicating that its stock price is 24% more volatile than the S&P 500. Comparatively, Aspen Technology’s peers have a beta of 1.27, indicating that their average stock price is 27% more volatile than the S&P 500.

Summary

Aspen Technology peers beat Aspen Technology on 10 of the 13 factors compared.

About Aspen Technology

Aspen Technology, Inc. is a global provider of process optimization software solutions designed to manage and optimize plant and process design, operational performance, and supply chain planning. The Company’s aspenONE software and related services have been developed specifically for companies in the process industries, including the energy, chemicals, and engineering and construction industries. It operates through two segments, including subscription and software, which provides licensing of process optimization software solutions and associated support services, and services, which includes professional services and training. It has developed applications to design and optimize processes across the business areas, including engineering, manufacturing and supply chain. Its products include Aspen HYSYS, Aspen Economic Evaluation, Aspen Info Plus.21, Aspen PIMS Advanced Optimization, Aspen Collaborative Demand Manager and Aspen Supply Planner.

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