Financial Analysis: LogMeIn (LOGM) vs. CSRA (CSRA)

LogMeIn (NASDAQ: LOGM) and CSRA (NYSE:CSRA) are both mid-cap computer and technology companies, but which is the superior business? We will compare the two companies based on the strength of their institutional ownership, earnings, profitability, analyst recommendations, dividends, valuation and risk.

Profitability

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

Net Margins Return on Equity Return on Assets
LogMeIn 1.01% 5.50% 4.23%
CSRA 7.46% 68.98% 6.50%

Analyst Recommendations

This is a summary of recent ratings for LogMeIn and CSRA, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
LogMeIn 0 1 8 0 2.89
CSRA 1 7 3 0 2.18

LogMeIn presently has a consensus target price of $141.71, indicating a potential upside of 12.52%. CSRA has a consensus target price of $37.08, indicating a potential downside of 8.50%. Given LogMeIn’s stronger consensus rating and higher possible upside, equities analysts plainly believe LogMeIn is more favorable than CSRA.

Earnings and Valuation

This table compares LogMeIn and CSRA’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
LogMeIn $336.07 million 19.73 $2.63 million $0.11 1,145.10
CSRA $4.99 billion 1.33 $304.00 million $2.29 17.69

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

Institutional and Insider Ownership

99.2% of LogMeIn shares are owned by institutional investors. Comparatively, 95.9% of CSRA shares are owned by institutional investors. 2.5% of LogMeIn shares are owned by company insiders. Comparatively, 0.4% of CSRA shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Dividends

LogMeIn pays an annual dividend of $1.20 per share and has a dividend yield of 1.0%. CSRA pays an annual dividend of $0.40 per share and has a dividend yield of 1.0%. LogMeIn pays out 1,091.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. CSRA pays out 17.5% of its earnings in the form of a dividend. CSRA is clearly the better dividend stock, given its higher yield and lower payout ratio.

Volatility and Risk

LogMeIn has a beta of 1.36, meaning that its share price is 36% more volatile than the S&P 500. Comparatively, CSRA has a beta of 1.81, meaning that its share price is 81% more volatile than the S&P 500.

Summary

CSRA beats LogMeIn on 9 of the 16 factors compared between the two stocks.

About LogMeIn

LogMeIn, Inc. provides a portfolio of cloud-based service offerings, which helps people and businesses to connect to their workplace, colleagues and customers. The Company’s core cloud-based services are categorized into four business lines: Communications and Collaboration; Engagement and Support; Identity and Access, and Additional Service Offerings. The Company’s communication and collaboration services include GoToMeeting; GoToTraining; GoToWebinar; join.me, join.me pro and join.me enterprise; OpenVoice, and Grasshopper. The Company’s customer engagement and support services include BoldChat; GoToAssist, GoToAssist Corporate and GoToAssist Seeit; LogMeIn Rescue, Rescue Lens and LogMeIn Rescue+Mobile, and Xively. Its identity and access management services include LogMeIn Central, GoToMyPC, LogMeIn Pro and LastPass. Its additional service offerings include LogMeIn Backup, LogMeIn Hamachi and RemotelyAnywhere.

About CSRA

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.

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