Analyzing Barracuda Networks (CUDA) and Gartner (IT)

Barracuda Networks (NYSE: CUDA) and Gartner (NYSE:IT) are both it services & consulting – nec companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, dividends, earnings, profitability, analyst recommendations, valuation and risk.

Earnings & Valuation

This table compares Barracuda Networks and Gartner’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Barracuda Networks $352.65 million 4.19 $10.23 million $0.28 98.36
Gartner $3.31 billion 3.16 $193.58 million $0.03 3,849.67

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

Profitability

This table compares Barracuda Networks and Gartner’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Barracuda Networks 4.09% 74.59% 2.98%
Gartner 0.10% 49.06% 5.14%

Institutional and Insider Ownership

74.5% of Barracuda Networks shares are owned by institutional investors. Comparatively, 95.7% of Gartner shares are owned by institutional investors. 13.9% of Barracuda Networks shares are owned by company insiders. Comparatively, 4.3% of Gartner shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Volatility & Risk

Barracuda Networks has a beta of 3.06, meaning that its share price is 206% more volatile than the S&P 500. Comparatively, Gartner has a beta of 1.06, meaning that its share price is 6% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Barracuda Networks and Gartner, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Barracuda Networks 0 9 3 0 2.25
Gartner 0 2 6 1 2.89

Barracuda Networks presently has a consensus price target of $28.51, indicating a potential upside of 3.52%. Gartner has a consensus price target of $132.00, indicating a potential upside of 14.30%. Given Gartner’s stronger consensus rating and higher probable upside, analysts clearly believe Gartner is more favorable than Barracuda Networks.

Summary

Gartner beats Barracuda Networks on 9 of the 15 factors compared between the two stocks.

About Barracuda Networks

Barracuda Networks, Inc. designs and delivers security and data protection solutions. The Company offers cloud-enabled solutions that enable customers to address security threats, manage network performance, and protect and store their data. Its solutions are designed to manage information technology operations for its customers. Its security solutions include Barracuda Email Security, The Barracuda Web Security Gateway, Barracuda NextGen Firewalls, The Barracuda Web Application Firewall, The Barracuda Load Balancer ADC and The Barracuda SSL VPN. Its data protection solutions provide solutions for on-premises and cloud-based archiving and backup. Its data protection solutions include Barracuda Backup, Barracuda Message Archiver and CudaSign. Its solution suites combine its security and data protection offerings into services designed for cloud platforms and managed services environments. Its solution suites include Barracuda Essentials for Office 365 and Intronis ECHOplatform.

About Gartner

Gartner, Inc. is an information technology research and advisory company. The Company works with clients to research, analyze and interpret the business of information technology (IT), supply chain and marketing within the context of their individual roles. It operates in three segments: Research, Consulting and Events. Research segment consists of subscription-based research products, access to research inquiry, peer networking services and membership programs. Consulting segment consists of consulting, measurement engagements and strategic advisory services. Events segment consists of various symposia, conferences and exhibitions. It provides insight through reports, briefings, tools, access to its analysts, peer networking services and membership programs that enable its clients to make decisions about their IT, supply chain and digital marketing initiatives. Its consultants provide fact-based consulting services to help clients use and manage IT to optimize business performance.

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