Parsons (NYSE:PSN) versus Acuity (NYSE:AYI) Head to Head Comparison

Parsons (NYSE:PSN) and Acuity (NYSE:AYI) are both mid-cap business services companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, profitability, valuation, institutional ownership, earnings and dividends.

Volatility & Risk

Parsons has a beta of 0.64, indicating that its stock price is 36% less volatile than the S&P 500. Comparatively, Acuity has a beta of 1.31, indicating that its stock price is 31% more volatile than the S&P 500.

Profitability

This table compares Parsons and Acuity’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Parsons	3.62%	11.52%	5.36%
Acuity	9.37%	20.74%	12.20%

Valuation and Earnings

This table compares Parsons and Acuity”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Parsons	$6.36 billion	0.82	$241.14 million	$2.09	23.33
Acuity	$4.35 billion	2.24	$396.60 million	$13.64	23.55

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

Insider & Institutional Ownership

98.0% of Parsons shares are held by institutional investors. Comparatively, 98.2% of Acuity shares are held by institutional investors. 1.3% of Parsons shares are held by insiders. Comparatively, 2.9% of Acuity shares are held 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.

Analyst Ratings

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

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Parsons	0	6	9	0	2.60
Acuity	0	4	5	0	2.56

Parsons presently has a consensus price target of $76.92, indicating a potential upside of 57.77%. Acuity has a consensus price target of $369.17, indicating a potential upside of 14.92%. Given Parsons’ stronger consensus rating and higher probable upside, research analysts clearly believe Parsons is more favorable than Acuity.

Summary

Acuity beats Parsons on 10 of the 14 factors compared between the two stocks.

About Parsons

Parsons Corporation provides integrated solutions and services in the defense, intelligence, and critical infrastructure markets in North America, the Middle East, and internationally. The company operates through Federal Solutions and Critical Infrastructure segments. The Federal Solutions segment provides critical technologies, such as cybersecurity; missile defense; intelligence; space launch and ground systems; space and weapon system resiliency; geospatial intelligence; signals intelligence; environmental remediation; border security, critical infrastructure protection; counter unmanned air systems; biometrics and bio surveillance solutions to U.S. Department of Defense, including military services; Missile Defense Agency, the Department of Energy; the Department of State; the Department of Homeland Security, and the Federal Aviation Administration. The Critical Infrastructure segment provides management, design, and engineering services, as well as offers leveraging sensor solutions. This segment develops digital solutions for next generation aviation, rail and transit, bridges, roads, and highways; and provides water and wastewater treatment systems; AI/ML, and digital twin and cyber systems integration services; planning, engineering, and management services for infrastructure, including bridges and tunnels, roads and highways, water and wastewater, and dams and reservoirs. Parsons Corporation was founded in 1944 and is headquartered in Chantilly, Virginia.

About Acuity

Acuity Brands, Inc. provides lighting, lighting controls, building management system, location-aware applications in the United States and internationally. The company operates in two segments, Acuity Brands Lighting and Lighting Controls (ABL); and the Intelligent Spaces Group (ISG). The ABL segment provides commercial, architectural, and specialty lighting solutions, as well as lighting controls and components for various indoor and outdoor applications under the A-Light, Aculux, American Electric Lighting, Cyclone, Dark to Light, eldoLED, Eureka, Gotham, Healthcare Lighting, Holophane, Hydrel, Indy, IOTA, Juno, Lithonia Lighting, Luminaire LED, Luminis, Mark Architectural Lighting, nLight, OPTOTRONIC, Peerless, RELOCWiring Solutions, and Sensor Switch. This segment serves electrical distributors, retail home improvement centers, electric utilities, national accounts, original equipment manufacturers, digital retailers, lighting showrooms, and energy service companies. The ISG segment offers building management solutions, such as products for controlling heating, ventilation, air conditioning, lighting, shades, refrigeration, and building access that deliver end-to-end optimization of those building systems; and building management software that enhances building system management and automates labor intensive tasks. This segment serves system integrators, as well as retail stores, airports, and enterprise campuses. The company offers its products and solutions under the Atrius, Distech Controls, and KE2 Therm Solutions brands. Acuity Brands, Inc. was incorporated in 2001 and is headquartered in Atlanta, Georgia.