Financial Survey: CSRA (CSRA) versus Echelon (ELON)

CSRA (NYSE: CSRA) and Echelon (NASDAQ:ELON) are both technology companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, earnings, risk, profitability, analyst recommendations, institutional ownership and dividends.

Profitability

This table compares CSRA and Echelon’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CSRA 6.35% 79.44% 6.35%
Echelon -14.96% -18.48% -13.66%

Institutional & Insider Ownership

94.7% of CSRA shares are held by institutional investors. Comparatively, 22.8% of Echelon shares are held by institutional investors. 0.4% of CSRA shares are held by insiders. Comparatively, 10.2% of Echelon 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 Ratings

This is a breakdown of recent ratings and target prices for CSRA and Echelon, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CSRA 1 2 6 0 2.56
Echelon 0 0 0 0 N/A

CSRA presently has a consensus price target of $36.22, suggesting a potential upside of 13.41%. Given CSRA’s higher probable upside, equities analysts clearly believe CSRA is more favorable than Echelon.

Valuation and Earnings

This table compares CSRA and Echelon’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
CSRA $4.99 billion 1.05 $304.00 million $1.92 16.64
Echelon $32.38 million 0.76 -$4.10 million ($1.06) -5.10

CSRA has higher revenue and earnings than Echelon. Echelon is trading at a lower price-to-earnings ratio than CSRA, indicating that it is currently the more affordable of the two stocks.

Dividends

CSRA pays an annual dividend of $0.40 per share and has a dividend yield of 1.3%. Echelon does not pay a dividend. CSRA pays out 20.8% of its earnings in the form of a dividend.

Summary

CSRA beats Echelon on 12 of the 14 factors compared between the two stocks.

CSRA Company Profile

CSRA Inc. is a provider of information technology services to the United States federal government. The Company operates through two segments: Defense and Intelligence, and Civil. The Defense and Intelligence segment provides services to the Department of Defense (DoD), National Security Agency, branches of the Armed Forces, and other DoD and Intelligence agencies. The Civil segment provides services to various federal agencies within the Department of Homeland Security (the DHS), Department of Health and Human services, and other federal civil agencies, as well as various state and local government agencies. It supplies civil government agencies with mission information systems and associated technical support services. It provides its customers with technical services across service areas, including Digital Services, Enterprise Business Services, Digital Platforms, Cyber, Data Science, and Professional and Citizen Services. It has conducted operations in over 130 locations.

Echelon Company Profile

Echelon Corporation develops open-standard control networking platforms and delivers elements necessary to design, install, monitor and control communities of devices. The Company’s products enable everyday devices, such as air conditioners, outdoor lighting, appliances, electricity meters, light switches, thermostats and valves to be inter-connected and be part of the Industrial Internet of Things (IIoT) market. It operates through the IIoT segment. Its IIoT business sells products and services that form embedded control platforms, such as LONWORKS and IzoT. The Company’s IIoT business also sells products and services, which include components, control nodes and development software. The Company also offers a solution consisting of outdoor lighting controllers, segment controllers, gateways and software to end customers, such as municipalities, cities, campuses and commercial enterprises. The Company markets its products under the Echelon brand.

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