Comparing DST Systems (DST) & Carbonite (CARB)

DST Systems (NYSE: DST) and Carbonite (NASDAQ:CARB) are both computer and technology companies, but which is the superior business? We will compare the two companies based on the strength of their valuation, earnings, dividends, institutional ownership, profitability, analyst recommendations and risk.

Valuation and Earnings

This table compares DST Systems and Carbonite’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
DST Systems $2.22 billion 2.25 $451.50 million $3.36 25.00
Carbonite $239.46 million 4.30 -$4.00 million $0.50 72.10

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

Dividends

DST Systems pays an annual dividend of $0.72 per share and has a dividend yield of 0.9%. Carbonite does not pay a dividend. DST Systems pays out 21.4% of its earnings in the form of a dividend. DST Systems has raised its dividend for 2 consecutive years.

Profitability

This table compares DST Systems and Carbonite’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
DST Systems 20.35% 16.90% 6.96%
Carbonite 0.14% 35.49% 4.55%

Analyst Recommendations

This is a summary of recent ratings and recommmendations for DST Systems and Carbonite, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
DST Systems 0 4 0 0 2.00
Carbonite 0 1 6 0 2.86

DST Systems presently has a consensus price target of $68.33, indicating a potential downside of 18.64%. Carbonite has a consensus price target of $32.86, indicating a potential downside of 8.86%. Given Carbonite’s stronger consensus rating and higher possible upside, analysts plainly believe Carbonite is more favorable than DST Systems.

Institutional and Insider Ownership

85.7% of DST Systems shares are held by institutional investors. Comparatively, 97.2% of Carbonite shares are held by institutional investors. 1.8% of DST Systems shares are held by company insiders. Comparatively, 9.8% of Carbonite shares are held by company 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.

Risk & Volatility

DST Systems has a beta of 1.51, meaning that its stock price is 51% more volatile than the S&P 500. Comparatively, Carbonite has a beta of 0.17, meaning that its stock price is 83% less volatile than the S&P 500.

Summary

Carbonite beats DST Systems on 9 of the 17 factors compared between the two stocks.

DST Systems Company Profile

DST Systems, Inc. provides technology-based information processing and servicing solutions in the United States, the United Kingdom, Canada, Australia, and internationally. It operates through Domestic Financial Services, International Financial Services, and Healthcare Services segments. The Domestic Financial Services segment provides investor, investment, advisor/intermediary, and asset distribution services to companies in the financial services industry to support direct and intermediary sales of mutual funds, alternative investments, securities brokerage accounts, and retirement plans. Its services include transaction processing; account opening and maintenance; reconciliation of trades, positions, and cash; corporate actions; regulatory reporting and compliance functions; and tax reporting. The International Financial Services segment offers investor and policyholder administration and technology services on a remote processing and business process outsourcing basis to mutual fund managers, insurers, and platform providers, as well as provides solutions related to participant accounting and recordkeeping for clients in the wealth management and retirement savings industries/markets. Its Healthcare Services segment offers software applications to provide healthcare organizations with pharmacy, healthcare administration, and health outcomes optimization solutions for information processing, quality of care, cost management, and payment integrity needs; and healthcare solutions, including claims adjudication, benefit management, care management, business intelligence, and other ancillary services. The company was founded in 1968 and is headquartered in Kansas City, Missouri.

Carbonite Company Profile

Carbonite, Inc., together with its subsidiaries, provides backup, disaster recovery, high availability, and workload migration technology solutions in the United States. Its solutions include Carbonite Safe that offers annual and multi-year cloud backup plans for individuals or businesses; and Carbonite Endpoint Protection that protects the data, which resides on an organization's computers, laptops, tablets, and smartphones. The company's solutions also comprise Carbonite Hybrid Backup, which protects a customer's data footprint on-premise and in the cloud and enables recovery while version history stored in the cloud safeguards against disaster; Carbonite Cloud Backup that automatically backs up data to the cloud and keeps physical and virtual systems protected with point-in-time restore; and Carbonite Onsite Backup, a flexible data protection solution, which backs up and replicates data securely across a customer's own private network. In addition, it offers Carbonite Availability that keeps critical business systems available on Windows and Linux servers; Carbonite Recover, a disaster recovery-as-a-service solution that securely replicates critical systems from a customer's primary environment to the cloud; Carbonite Migrate, which migrates physical, virtual, and cloud workloads to and from any environment with minimal risk and near-zero downtime; and Carbonite Email Archiving that provides MailStore offerings designed to meet the specific email archiving needs of customers in terms of performance, stability, functionality, and simplicity. The company provides its solutions through distributors, value-added resellers, managed service providers, and global systems integrators. Carbonite, Inc. was founded in 2005 and is headquartered in Boston, Massachusetts.

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