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

Insider and Institutional Ownership

90.3% of IMS Health Holdings shares are held by institutional investors. 2.5% of IMS Health Holdings shares are held by insiders. Comparatively, 1.0% of Manhattan Associates shares 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.

Analyst Recommendations

This is a summary of recent ratings for IMS Health Holdings and Manhattan Associates, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
IMS Health Holdings 0 0 0 0 N/A
Manhattan Associates 0 3 2 0 2.40

Manhattan Associates has a consensus target price of $65.00, suggesting a potential upside of 53.19%. Given Manhattan Associates’ higher probable upside, analysts clearly believe Manhattan Associates is more favorable than IMS Health Holdings.

Valuation and Earnings

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

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
IMS Health Holdings N/A N/A N/A $0.42 74.62
Manhattan Associates $597.44 million 4.90 $202.15 million $1.74 24.39

Manhattan Associates has higher revenue and earnings than IMS Health Holdings. Manhattan Associates 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 and Risk

IMS Health Holdings has a beta of 0.83, meaning that its stock price is 17% less volatile than the S&P 500. Comparatively, Manhattan Associates has a beta of 1.12, meaning that its stock price is 12% more volatile than the S&P 500.

Profitability

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

Net Margins Return on Equity Return on Assets
IMS Health Holdings 2.99% 5.62% 1.22%
Manhattan Associates 20.38% 74.19% 41.53%

Summary

Manhattan Associates beats IMS Health Holdings on 8 of the 10 factors compared between the two stocks.

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.

Manhattan Associates Company Profile

Manhattan Associates, Inc. (Manhattan) is a developer and provider of supply chain commerce solutions. The Company operates through three geographical segments: the Americas, Europe, Middle East and Africa (EMEA), and the Asia Pacific (APAC). It is engaged in developing, selling, deploying, servicing and maintaining software solutions designed to manage supply chains, inventory and omni-channel operations for retailers, wholesalers, manufacturers, logistics providers and other organizations. Its solutions consist of software, services and hardware, which coordinate people, workflows, assets, events and tasks across the functions linked in a supply chain from planning through execution. Its supply chain solutions consist of three components: Distribution Management, Transportation Management and Visibility. Its Omni-Channel Solutions include Omni-Channel Central Solutions and Omni-Channel Local Solutions. Its Inventory solutions include Inventory Optimization and Planning.

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