Analyzing Proofpoint (PFPT) and Accenture (ACN)

Proofpoint (NASDAQ: PFPT) and Accenture (NYSE:ACN) are both mid-cap technology companies, but which is the superior investment? We will compare the two companies based on the strength of their earnings, profitability, dividends, analyst recommendations, valuation, institutional ownership and risk.

Earnings and Valuation

This table compares Proofpoint and Accenture’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Proofpoint $375.50 million 11.74 -$111.20 million ($2.21) -44.50
Accenture $36.77 billion 2.79 $3.45 billion $5.64 28.62

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

Analyst Ratings

This is a summary of recent ratings and price targets for Proofpoint and Accenture, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Proofpoint 1 3 20 0 2.79
Accenture 2 9 11 0 2.41

Proofpoint currently has a consensus target price of $102.50, suggesting a potential upside of 4.23%. Accenture has a consensus target price of $155.86, suggesting a potential downside of 3.45%. Given Proofpoint’s stronger consensus rating and higher possible upside, equities analysts clearly believe Proofpoint is more favorable than Accenture.

Profitability

This table compares Proofpoint and Accenture’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Proofpoint -20.19% -158.19% -7.03%
Accenture 9.43% 41.79% 17.84%

Institutional & Insider Ownership

75.4% of Accenture shares are owned by institutional investors. 6.0% of Proofpoint shares are owned by company insiders. Comparatively, 0.2% of Accenture shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Volatility & Risk

Proofpoint has a beta of 1.32, suggesting that its share price is 32% more volatile than the S&P 500. Comparatively, Accenture has a beta of 1.08, suggesting that its share price is 8% more volatile than the S&P 500.

Dividends

Accenture pays an annual dividend of $2.66 per share and has a dividend yield of 1.6%. Proofpoint does not pay a dividend. Accenture pays out 47.2% of its earnings in the form of a dividend. Proofpoint has increased its dividend for 8 consecutive years.

Summary

Accenture beats Proofpoint on 9 of the 17 factors compared between the two stocks.

About Proofpoint

Proofpoint, Inc. is a security-as-a-service provider that enables large and mid-sized organizations to defend, protect, archive and govern their sensitive data. The Company’s security-as-a-service platform consists of an integrated suite of on-demand data protection solutions, including threat protection, incident response, regulatory compliance, archiving, governance, eDiscovery and secure communication. The Company’s solutions are built on a cloud-based platform. The Company provides a multi-tiered security-as-a-service platform, including solutions, platform technologies and infrastructure. Its product families include Email Security, Proofpoint Advanced Threat Protection, Proofpoint Information Protection and Archiving, and Proofpoint Digital Risk Protection. The Company’s platform services include Threat detection, Threat intel extraction, Nexus threat graph, Real-time detection, Information classification and Intelligent policy.

About Accenture

Accenture plc is a professional services company serving clients in various industries and in geographic regions, including North America, Europe and Growth Markets. The Company provides management and technology consulting services. Its segments include Communications, Media and Technology; Financial Services; Health and Public Service; Products, and Resources. The Communications, Media & Technology segment serves communications, electronics, technology, media and entertainment industries. The Financial Services segment serves banking, capital markets and insurance industries. The Health & Public service segment serves healthcare payers and providers, and government departments and agencies, public service organizations, educational institutions and non-profit organizations. The Products segment serves a set of interconnected consumer-relevant industries. The Resources segment serves chemicals, energy, forest products, metals and mining, utilities and related industries.

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