Financial Comparison: Vertiv (NYSE:VRT) vs. Science Applications International (NASDAQ:SAIC)

Science Applications International (NASDAQ:SAIC) and Vertiv (NYSE:VRT) are both computer and technology companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, analyst recommendations, earnings, risk, valuation, profitability and institutional ownership.

Institutional and Insider Ownership

76.0% of Science Applications International shares are owned by institutional investors. Comparatively, 89.9% of Vertiv shares are owned by institutional investors. 0.4% of Science Applications International shares are owned by insiders. Comparatively, 1.1% of Vertiv shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Science Applications International and Vertiv’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Science Applications International	4.93%	33.15%	9.44%
Vertiv	14.37%	49.90%	15.79%

Risk & Volatility

Science Applications International has a beta of 0.28, meaning that its stock price is 72% less volatile than the S&P 500. Comparatively, Vertiv has a beta of 2.09, meaning that its stock price is 109% more volatile than the S&P 500.

Valuation and Earnings

This table compares Science Applications International and Vertiv”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Science Applications International	$7.26 billion	0.61	$358.00 million	$7.69	13.18
Vertiv	$10.84 billion	11.49	$1.33 billion	$3.98	81.49

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

Dividends

Science Applications International pays an annual dividend of $1.48 per share and has a dividend yield of 1.5%. Vertiv pays an annual dividend of $0.25 per share and has a dividend yield of 0.1%. Science Applications International pays out 19.2% of its earnings in the form of a dividend. Vertiv pays out 6.3% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Vertiv has raised its dividend for 2 consecutive years.

Analyst Recommendations

This is a summary of current recommendations for Science Applications International and Vertiv, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Science Applications International	1	7	3	0	2.18
Vertiv	1	3	22	1	2.85

Science Applications International presently has a consensus price target of $110.78, suggesting a potential upside of 9.29%. Vertiv has a consensus price target of $322.32, suggesting a potential downside of 0.62%. Given Science Applications International’s higher possible upside, analysts clearly believe Science Applications International is more favorable than Vertiv.

Summary

Vertiv beats Science Applications International on 15 of the 18 factors compared between the two stocks.

About Science Applications International

Science Applications International Corporation provides technical, engineering, and enterprise information technology (IT) services primarily in the United States. The company’s offerings include engineering; technology integration; IT modernization; maintenance of ground and maritime systems; logistics; training and simulation; operation and program support services; and end-to-end services, such as design, development, integration, deployment, management and operations, sustainment, and security of its customers’ IT infrastructure, as well as cloud migration, managed services, infrastructure modernization, and enterprise IT-as-a-service solutions. It serves the U.S. military comprising Army, Air Force, Navy, Marines, and Coast Guard; Department of Defense agencies; National Aeronautics and Space Administration; the U.S. Department of State; Department of Justice; Department of Homeland Security; and various intelligence community agencies, as well as U.S. federal civilian agencies. The company was formerly known as SAIC Gemini, Inc. and changed its name to Science Applications International Corporation in September 2013. Science Applications International Corporation was founded in 1969 and is headquartered in Reston, Virginia.

About Vertiv

Vertiv Holdings Co, together with its subsidiaries, designs, manufactures, and services critical digital infrastructure technologies and life cycle services for data centers, communication networks, and commercial and industrial environments in the Americas, the Asia Pacific, Europe, the Middle East, and Africa. It offers AC and DC power management products, switchgear and busbar products, thermal management products, integrated rack systems, modular solutions, and management systems for monitoring and controlling digital infrastructure that are integral to the technologies used for various services, including e-commerce, online banking, file sharing, video on-demand, energy storage, wireless communications, Internet of Things, and online gaming. The company also provides lifecycle management services, predictive analytics, and professional services for deploying, maintaining, and optimizing its products and their related systems; and preventative maintenance, acceptance testing, engineering and consulting, performance assessments, remote monitoring, training, spare parts, and digital critical infrastructure software services. It offers its products primarily under the Vertiv, Liebert, NetSure, Geist, E&I, Powerbar, and Avocent brands. The company serves cloud services, financial services, healthcare, transportation, manufacturing, energy, education, government, social media, and retail industries through a network of direct sales professionals, independent sales representatives, channel partners, and original equipment manufacturers. Vertiv Holdings Co is headquartered in Westerville, Ohio.