Red Hat (NYSE: RHT) and SS&C Technologies (NASDAQ:SSNC) are both mid-cap technology companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, analyst recommendations, risk, valuation, institutional ownership, profitability and dividends.
Institutional and Insider Ownership
94.3% of Red Hat shares are owned by institutional investors. Comparatively, 86.0% of SS&C Technologies shares are owned by institutional investors. 0.7% of Red Hat shares are owned by insiders. Comparatively, 17.6% of SS&C Technologies shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Red Hat has a beta of 1.19, indicating that its share price is 19% more volatile than the S&P 500. Comparatively, SS&C Technologies has a beta of 1.08, indicating that its share price is 8% more volatile than the S&P 500.
This is a summary of recent ratings for Red Hat and SS&C Technologies, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Red Hat presently has a consensus price target of $125.31, indicating a potential upside of 0.58%. SS&C Technologies has a consensus price target of $48.33, indicating a potential downside of 0.30%. Given Red Hat’s higher probable upside, research analysts clearly believe Red Hat is more favorable than SS&C Technologies.
This table compares Red Hat and SS&C Technologies’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
SS&C Technologies pays an annual dividend of $0.28 per share and has a dividend yield of 0.6%. Red Hat does not pay a dividend. SS&C Technologies pays out 26.7% of its earnings in the form of a dividend.
Valuation & Earnings
This table compares Red Hat and SS&C Technologies’ top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Red Hat||$2.41 billion||9.14||$253.70 million||$1.84||67.71|
|SS&C Technologies||$1.48 billion||6.74||$130.99 million||$1.05||46.17|
Red Hat has higher revenue and earnings than SS&C Technologies. SS&C Technologies is trading at a lower price-to-earnings ratio than Red Hat, indicating that it is currently the more affordable of the two stocks.
Red Hat beats SS&C Technologies on 12 of the 17 factors compared between the two stocks.
Red Hat Company Profile
Red Hat, Inc. (Red Hat) provides open source software solutions, using a community-powered approach to develop and offer operating system, virtualization, management, middleware, cloud, mobile and storage technologies. Red Hat operates through three geographical segments: the Americas, including the United States, Canada and Latin America; EMEA, including Europe, Middle East and Africa, and Asia Pacific. Its products and services include infrastructure-related offerings, application development-related and other technology offerings, and consulting, support and training services. Its infrastructure-related offerings include Red Hat Enterprise Linux, Red Hat Satellite and Red Hat Enterprise Virtualization. Its application development-related and other technology offerings include Red Hat JBoss Middleware, Red Hat cloud offerings, Red Hat Mobile and Red Hat Storage. Its consulting services include upgrade planning, platform migrations, solution integration and application development.
SS&C Technologies Company Profile
SS&C Technologies Holdings, Inc. is a holding company. The Company is a provider of software products and software-enabled services that allow financial services providers to automate complex business processes and manage their information processing requirements. The Company’s portfolio of software products and software-enabled services allows its clients to automate and integrate front-office functions, such as trading and modeling, middle-office functions, such as portfolio management and reporting, and back-office functions, such as accounting, performance measurement, reconciliation, reporting, processing and clearing. The Company provides its solutions across the globe to over 11,000 clients, principally within the institutional asset and wealth management, alternative investment management, financial advisory and financial institutions vertical markets. Its portfolio includes over 90 products and software-enabled services.
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