Booz Allen Hamilton (NYSE: BAH) and Gartner (NYSE:IT) are both business services companies, but which is the better business? We will compare the two companies based on the strength of their valuation, institutional ownership, earnings, profitability, risk, analyst recommendations and dividends.
Institutional & Insider Ownership
93.6% of Booz Allen Hamilton shares are owned by institutional investors. Comparatively, 96.8% of Gartner shares are owned by institutional investors. 3.0% of Booz Allen Hamilton shares are owned by insiders. Comparatively, 4.3% of Gartner shares are owned by 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.
This table compares Booz Allen Hamilton and Gartner’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Booz Allen Hamilton||$5.80 billion||0.99||$252.49 million||$1.91||20.68|
|Gartner||$3.31 billion||3.40||$3.27 million||$0.03||4,134.00|
Booz Allen Hamilton has higher revenue and earnings than Gartner. Booz Allen Hamilton is trading at a lower price-to-earnings ratio than Gartner, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Booz Allen Hamilton has a beta of 1.29, suggesting that its stock price is 29% more volatile than the S&P 500. Comparatively, Gartner has a beta of 1.22, suggesting that its stock price is 22% more volatile than the S&P 500.
Booz Allen Hamilton pays an annual dividend of $0.76 per share and has a dividend yield of 1.9%. Gartner does not pay a dividend. Booz Allen Hamilton pays out 39.8% of its earnings in the form of a dividend. Gartner has increased its dividend for 5 consecutive years.
This table compares Booz Allen Hamilton and Gartner’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Booz Allen Hamilton||4.68%||50.81%||8.24%|
This is a breakdown of recent recommendations and price targets for Booz Allen Hamilton and Gartner, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Booz Allen Hamilton||0||5||7||0||2.58|
Booz Allen Hamilton presently has a consensus target price of $41.25, indicating a potential upside of 4.42%. Gartner has a consensus target price of $137.11, indicating a potential upside of 10.56%. Given Gartner’s stronger consensus rating and higher possible upside, analysts clearly believe Gartner is more favorable than Booz Allen Hamilton.
Booz Allen Hamilton Company Profile
Booz Allen Hamilton Holding Corporation is a holding company. The Company is a provider of management and technology, consulting and engineering services to the United States and international governments, corporations and not-for-profit organizations. The Company’s client base includes government, commercial and international clients. Its commercial clients in the United States are primarily in the financial services, healthcare and life sciences, energy, high-technology manufacturing, retail, and automotive industries. Its international clients are primarily in the Middle East, along with a presence in Southeast Asia. The Company’s functional service offerings include Systems Delivery, Engineering and Science, Cyber, Analytics and Consulting. The Company’s innovation service offerings are Digital, Cyber Futures, Next Generation Analytics and Directed Energy.
Gartner Company Profile
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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