Descartes Systems Group (NASDAQ: DSGX) and DealerTrack Technologies (NASDAQ:TRAK) are both computer and technology companies, but which is the superior investment? We will contrast the two businesses based on the strength of their profitability, risk, institutional ownership, valuation, dividends, earnings and analyst recommendations.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Descartes Systems Group and DealerTrack Technologies, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Descartes Systems Group 0 3 5 0 2.63
DealerTrack Technologies 0 0 0 0 N/A

Descartes Systems Group presently has a consensus price target of $33.81, indicating a potential upside of 19.06%.

Institutional & Insider Ownership

77.0% of Descartes Systems Group shares are held by institutional investors. 0.3% of Descartes Systems Group 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.

Profitability

This table compares Descartes Systems Group and DealerTrack Technologies’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Descartes Systems Group 11.61% 5.83% 4.78%
DealerTrack Technologies -3.45% -3.48% -1.59%

Valuation and Earnings

This table compares Descartes Systems Group and DealerTrack Technologies’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Descartes Systems Group $203.78 million 10.70 $23.83 million $0.34 83.53
DealerTrack Technologies N/A N/A N/A ($0.67) N/A

Descartes Systems Group has higher revenue and earnings than DealerTrack Technologies. DealerTrack Technologies is trading at a lower price-to-earnings ratio than Descartes Systems Group, indicating that it is currently the more affordable of the two stocks.

Summary

Descartes Systems Group beats DealerTrack Technologies on 8 of the 8 factors compared between the two stocks.

About Descartes Systems Group

Descartes Systems Group Inc (Descartes) is a Canada-based global provider of federated network and global logistics technology solutions that help its customers make and receive shipments and manage related resources. Its network-based solutions, which primarily consist of services and software, connect people to their trading partners and enable business document exchange (bookings, bills of lading, status messages); regulatory compliance and customs filing; route and resource planning, execution and monitoring; access and leverage global trade and restricted party data; inventory and asset visibility; rate and transportation management, and warehouse operations. Its solutions include Logistics Technology Platform that fuses the Descartes Global Logistics Network (Descartes GLN); customs and regulatory compliance; routing, mobile and telematics; global logistics network services; transportation management, and broker and forwarder enterprise systems. It operates through MacroPoint.

About DealerTrack Technologies

Dealertrack Technologies, Inc. provides Web-based software solutions and services. The Company provides solutions and services for segments of the automotive retail industry, including dealers, lenders, original equipment manufacturers (OEMs), third-party retailers, aftermarket providers and other service providers. Dealertrack operates the online credit application networks in the United States and Canada. The Company’s solutions includes Digital Marketing solutions, Dealer Management solutions, F&I solutions, Inventory solutions, Registration & Titling solutions, and Collateral Management solutions. Digital Marketing solutions include digital marketing tools, such as desktop and mobile Website design, search engine optimization (SEO), search engine marketing (SEM), social media and reputation management tools. Registration & Titling solutions include online and cross-state vehicle registration services.

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