Houghton Mifflin Harcourt Learning Technology (HMHC) and John Wiley & Sons (JW.A) Critical Survey

Houghton Mifflin Harcourt Learning Technology (NASDAQ: HMHC) and John Wiley & Sons (NYSE:JW.A) are both business services companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, dividends, analyst recommendations, risk, profitability and earnings.

Insider and Institutional Ownership

75.0% of John Wiley & Sons shares are held by institutional investors. 1.1% of Houghton Mifflin Harcourt Learning Technology shares are held by insiders. Comparatively, 1.0% of John Wiley & Sons shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Dividends

John Wiley & Sons pays an annual dividend of $1.28 per share and has a dividend yield of 1.9%. Houghton Mifflin Harcourt Learning Technology does not pay a dividend. John Wiley & Sons pays out 42.7% of its earnings in the form of a dividend.

Analyst Recommendations

This is a summary of recent ratings and target prices for Houghton Mifflin Harcourt Learning Technology and John Wiley & Sons, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Houghton Mifflin Harcourt Learning Technology 1 4 1 0 2.00
John Wiley & Sons 0 2 0 0 2.00

Houghton Mifflin Harcourt Learning Technology presently has a consensus target price of $9.92, suggesting a potential upside of 45.83%. John Wiley & Sons has a consensus target price of $60.00, suggesting a potential downside of 10.31%. Given Houghton Mifflin Harcourt Learning Technology’s higher probable upside, equities research analysts clearly believe Houghton Mifflin Harcourt Learning Technology is more favorable than John Wiley & Sons.

Risk & Volatility

Houghton Mifflin Harcourt Learning Technology has a beta of 0.59, meaning that its share price is 41% less volatile than the S&P 500. Comparatively, John Wiley & Sons has a beta of 0.99, meaning that its share price is 1% less volatile than the S&P 500.

Earnings and Valuation

This table compares Houghton Mifflin Harcourt Learning Technology and John Wiley & Sons’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Houghton Mifflin Harcourt Learning Technology $1.41 billion 0.60 -$103.18 million ($1.25) -5.44
John Wiley & Sons $1.72 billion 2.22 $113.64 million $3.00 22.30

John Wiley & Sons has higher revenue and earnings than Houghton Mifflin Harcourt Learning Technology. Houghton Mifflin Harcourt Learning Technology is trading at a lower price-to-earnings ratio than John Wiley & Sons, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Houghton Mifflin Harcourt Learning Technology and John Wiley & Sons’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Houghton Mifflin Harcourt Learning Technology -5.98% -15.47% -4.62%
John Wiley & Sons 10.44% 18.07% 7.09%

Summary

John Wiley & Sons beats Houghton Mifflin Harcourt Learning Technology on 11 of the 15 factors compared between the two stocks.

About Houghton Mifflin Harcourt Learning Technology

Houghton Mifflin Harcourt Company, a learning company, provides content, services, and technology solutions for educational institutions and consumers worldwide. The company operates in two segments, Education and Trade Publishing. The Education segment provides educational products, technology platforms, and services, including print and digital content in the form of textbooks, digital courseware, instructional aids, educational assessment, and intervention solutions for students. The Trade Publishing segment primarily develops, markets, and sells consumer books in print and digital formats, as well as licenses book rights to other publishers and electronic businesses; and trade and reference materials, such as adult and children's fiction and non-fiction books to schools, colleges, libraries, office supply distributors, and other businesses. This segment distributes products through retail stores comprising physical and online, and wholesalers. The company was formerly known as HMH Holdings (Delaware), Inc. and changed its name to Houghton Mifflin Harcourt Company in October 2013. Houghton Mifflin Harcourt Company was founded in 1832 and is headquartered in Boston, Massachusetts.

About John Wiley & Sons

John Wiley & Sons, Inc. provides knowledge and knowledge-enabled services in the areas of research, professional practice and education. The Company operates through three segments: Research, Professional Development and Education. Through the Research segment, the Company provides digital and print scientific, technical, medical and scholarly journals, reference works, books, database services and advertising. The Professional Development segment provides digital and print books, corporate learning solutions, employment talent solutions and training services, and test prep and certification. In the Education segment, the Company provides print and digital content, and education solutions, including online program management services for higher education institutions and course management tools for instructors and students. The Company is engaged in developing and cross-marketing products to its customer base of researchers, professionals, students and educators.

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