Critical Survey: QAD (QADB) versus Kenexa (KNXA)

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

Analyst Ratings

This is a breakdown of current ratings and recommmendations for QAD and Kenexa, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
QAD 0 0 0 0 N/A
Kenexa 0 0 0 0 N/A

Valuation and Earnings

This table compares QAD and Kenexa’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
QAD $277.97 million 2.17 -$15.45 million ($1.03) -30.39
Kenexa N/A N/A N/A ($0.28) N/A

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

Dividends

QAD pays an annual dividend of $0.24 per share and has a dividend yield of 0.8%. Kenexa does not pay a dividend. QAD pays out -23.3% of its earnings in the form of a dividend.

Institutional & Insider Ownership

1.9% of QAD shares are owned by institutional investors. 67.4% of QAD shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares QAD and Kenexa’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
QAD -6.40% -2.06% -0.86%
Kenexa N/A N/A N/A

Summary

QAD beats Kenexa on 5 of the 9 factors compared between the two stocks.

QAD Company Profile

QAD Inc. (QAD) is a provider of vertically oriented enterprise software solutions for global manufacturing companies across the automotive, life sciences, consumer products, food and beverage, high technology and industrial products industries. QAD Enterprise Applications enables measurement and control of business processes and supports operational requirements, including financials, manufacturing, demand and supply chain planning, customer management, business intelligence and business process management. QAD delivers components of its solution for a range of mobile platforms. The Company’s mobile suite includes a requisition approval solution, a mobile business intelligence solution, mobile browse capability and mobile application monitoring tools to support system administrators. Its mobile browse capability allows users to view, filter and sort data accessible through QAD Browses within QAD Enterprise Applications using mobile devices.

Kenexa Company Profile

Provides integrated human capital management and technology solutions. The Company markets a suite of Web-based applications that automates recruitment, skills testing, and management processes for its client organizations. Kenexa hosts online career centers and job postings, skills tests, training materials, and surveys, all of which maintain the look of its clients’ Web sites. Kenexa also offers services such as talent acquisition and training and retention consulting.

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