BroadSoft (NASDAQ: BSFT) and Convergys Corporation (NYSE:CVG) are both computer and technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their profitability, risk, earnings, dividends, valuation, analyst recommendations and institutional ownership.
Valuation & Earnings
This table compares BroadSoft and Convergys Corporation’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|BroadSoft||$354.53 million||3.83||$24.27 million||($0.29)||-152.41|
|Convergys Corporation||$2.91 billion||0.76||$363.00 million||$1.41||16.70|
Convergys Corporation has higher revenue and earnings than BroadSoft. BroadSoft is trading at a lower price-to-earnings ratio than Convergys Corporation, indicating that it is currently the more affordable of the two stocks.
Convergys Corporation pays an annual dividend of $0.40 per share and has a dividend yield of 1.7%. BroadSoft does not pay a dividend. Convergys Corporation pays out 28.4% of its earnings in the form of a dividend. BroadSoft has raised its dividend for 4 consecutive years.
Institutional and Insider Ownership
99.3% of Convergys Corporation shares are held by institutional investors. 1.5% of BroadSoft shares are held by insiders. Comparatively, 1.7% of Convergys Corporation shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
This table compares BroadSoft and Convergys Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a summary of recent recommendations and price targets for BroadSoft and Convergys Corporation, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
BroadSoft presently has a consensus target price of $47.00, suggesting a potential upside of 6.33%. Given BroadSoft’s stronger consensus rating and higher possible upside, research analysts clearly believe BroadSoft is more favorable than Convergys Corporation.
Risk & Volatility
BroadSoft has a beta of 1.14, meaning that its share price is 14% more volatile than the S&P 500. Comparatively, Convergys Corporation has a beta of 1.04, meaning that its share price is 4% more volatile than the S&P 500.
Convergys Corporation beats BroadSoft on 9 of the 17 factors compared between the two stocks.
BroadSoft Company Profile
BroadSoft, Inc. is a global provider of software and services that enable telecommunications service providers to deliver hosted, cloud-based Unified Communications (UC) to their enterprise customers. The BroadSoft Business solution is a communications and collaboration offering that enables telecommunications service providers to offer businesses and other enterprises UC features and functionalities on a cloud-delivered basis without the need for traditional premise-based private branch exchange (PBX) equipment. BroadSoft Business includes its UC-One, Team-One and CC-One applications. The capabilities of the BroadSoft Business offering can be accessed through desk phones, smartphones, tablets, laptops and personal computers. Its BroadWorks SIP Trunking solution enables service providers to provide Internet protocol (IP) interconnectivity and additional services to enterprises that already have premise-based PBXs. Its training services include systems administration and provisioning.
Convergys Corporation Company Profile
Convergys Corporation is engaged in customer experience outsourcing. The Company’s geographical segments include North America and Rest of World. The Company offers services across industries, including communications and media, technology, financial services, retail, government and healthcare. The Company helps businesses to create customer experiences across multiple interaction channels, such as voice, chat, e-mail and interactive voice response. The Company provides solutions across the customer lifecycle, including sales, customer service, technical support, customer retention and collections. Its omni-channel contact center technology solutions include multichannel interaction solutions, cross-channel integration framework and robotic process automation. It offers analytics and consulting, and software solutions, including integrated customer experience analytics, post-contact surveys, relational loyalty research, and customer segmentation and profiling.
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