R.R. Donnelley & Sons (NYSE: RRD) and Cimpress (NASDAQ:CMPR) are both business services companies, but which is the superior stock? We will contrast the two companies based on the strength of their risk, profitability, earnings, dividends, valuation, analyst recommendations and institutional ownership.

Earnings and Valuation

This table compares R.R. Donnelley & Sons and Cimpress’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
R.R. Donnelley & Sons $6.90 billion 0.09 -$495.90 million ($7.07) -1.22
Cimpress $2.14 billion 1.78 -$71.71 million ($0.70) -175.24

Cimpress has lower revenue, but higher earnings than R.R. Donnelley & Sons. Cimpress is trading at a lower price-to-earnings ratio than R.R. Donnelley & Sons, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for R.R. Donnelley & Sons and Cimpress, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
R.R. Donnelley & Sons 0 0 0 0 N/A
Cimpress 0 3 1 0 2.25

Cimpress has a consensus target price of $102.50, indicating a potential downside of 16.44%. Given Cimpress’ higher possible upside, analysts clearly believe Cimpress is more favorable than R.R. Donnelley & Sons.

Institutional and Insider Ownership

85.8% of R.R. Donnelley & Sons shares are held by institutional investors. 2.3% of R.R. Donnelley & Sons shares are held by insiders. Comparatively, 11.8% of Cimpress shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

This table compares R.R. Donnelley & Sons and Cimpress’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
R.R. Donnelley & Sons -7.15% -42.52% 1.57%
Cimpress -0.85% -10.71% -0.55%

Volatility & Risk

R.R. Donnelley & Sons has a beta of 1.98, meaning that its stock price is 98% more volatile than the S&P 500. Comparatively, Cimpress has a beta of 0.13, meaning that its stock price is 87% less volatile than the S&P 500.

Dividends

R.R. Donnelley & Sons pays an annual dividend of $0.56 per share and has a dividend yield of 6.5%. Cimpress does not pay a dividend. R.R. Donnelley & Sons pays out -7.9% of its earnings in the form of a dividend.

Summary

Cimpress beats R.R. Donnelley & Sons on 8 of the 14 factors compared between the two stocks.

About R.R. Donnelley & Sons

R.R. Donnelley & Sons Company helps organizations communicate by working to create, manage, produce, distribute and process content on behalf of its customers. The Company’s segments include Variable Print, Strategic Services, International and Corporate. The Variable Print segment includes the Company’s United States short-run and transactional printing operations. The Variable Print segment’s primary product offerings include commercial and digital print, direct mail, labels, statement printing, forms and packaging. The Strategic Services segment includes the Company’s logistics services, print management offerings and digital and creative solutions. The International segment includes the Company’s non-United States printing operations in Asia, Latin America and Canada. The International segment’s primary product and service offerings include magazines, catalogs, retail inserts, books, directories, direct mail, logistics services and digital and creative solutions.

About Cimpress

Cimpress N.V., formerly Vistaprint N.V., is a technology driven company, which aggregates through the Internet, large volumes of small, individually customized orders for a spectrum of print, signage, apparel and similar products. The Company operates through segments, which include Vistaprint business unit, Upload and Print business units and All Other business units. The Vistaprint business unit segment represents its Vistaprint-branded Websites and its Webs-branded business. The Vistaprint business unit also sells standard business cards, and focuses on product categories, which include signage, marketing materials, and promotional products and apparel. The Upload and Print business units segment includes the druck.at, Exagroup, Easyflyer, Printdeal, Pixartprinting, Tradeprint, and WIRmachenDRUCK branded businesses. The All Other business units segment includes operations of its Albumprinter and Most of World business units and Corporate Solutions business unit.

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