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

Valuation & Earnings

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

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
LivePerson $215.63 million 3.93 $8.16 million ($0.50) -28.80
IMS Health Holdings N/A N/A N/A $0.42 74.62

LivePerson has higher revenue and earnings than IMS Health Holdings. LivePerson 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.

Volatility & Risk

LivePerson has a beta of 1.38, indicating that its stock price is 38% more volatile than the S&P 500. Comparatively, IMS Health Holdings has a beta of 0.83, indicating that its stock price is 17% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations and price targets for LivePerson and IMS Health Holdings, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
LivePerson 0 2 5 0 2.71
IMS Health Holdings 0 0 0 0 N/A

LivePerson currently has a consensus target price of $13.76, indicating a potential downside of 4.41%. Given LivePerson’s higher possible upside, analysts clearly believe LivePerson is more favorable than IMS Health Holdings.

Profitability

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

Net Margins Return on Equity Return on Assets
LivePerson -13.29% -8.71% -5.58%
IMS Health Holdings 2.99% 5.62% 1.22%

Insider and Institutional Ownership

74.9% of LivePerson shares are held by institutional investors. Comparatively, 90.3% of IMS Health Holdings shares are held by institutional investors. 11.4% of LivePerson shares are held by insiders. Comparatively, 2.5% of IMS Health Holdings shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

LivePerson Company Profile

LivePerson, Inc. (Liveperson) is a provider of mobile and online business messaging technologies that power digital communication between brands and consumers. The Company’s segments include Business and Consumer. The Business segment enables brands to leverage its cloud-based LiveEngage’s intelligence engine. The Consumer segment facilitates online transactions between independent service providers (Experts) and individual consumers (Users) seeking information and knowledge for a fee through mobile and online messaging. The Company’s platform, LiveEngage, enables businesses to create a meaningful connection with consumers by offering messaging as a preferred channel of communication. The Company’s products and services include LiveEngage, Professional Services and Consumer Offering. As a cloud computing or software-as-a-service (SaaS) provider, LivePerson provides solutions on a hosted basis. LiveEngage enables the combination of real time on-site data and off-site behavioral data.

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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