Intuit (INTU) vs. QAD (QADB) Critical Contrast

QAD (NASDAQ: QADB) and Intuit (NASDAQ:INTU) are both computer and technology companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, profitability, analyst recommendations, earnings and risk.

Institutional and Insider Ownership

1.8% of QAD shares are owned by institutional investors. Comparatively, 86.1% of Intuit shares are owned by institutional investors. 67.4% of QAD shares are owned by company insiders. Comparatively, 5.7% of Intuit shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Earnings and Valuation

This table compares QAD and Intuit’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
QAD $277.97 million 2.17 -$15.45 million ($0.94) -33.46
Intuit $5.18 billion 7.57 $971.00 million $3.72 41.30

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

Analyst Ratings

This is a summary of recent ratings and recommmendations for QAD and Intuit, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
QAD 0 0 1 0 3.00
Intuit 1 7 12 0 2.55

QAD currently has a consensus target price of $33.00, suggesting a potential upside of 4.93%. Intuit has a consensus target price of $143.88, suggesting a potential downside of 6.35%. Given QAD’s stronger consensus rating and higher probable upside, research analysts plainly believe QAD is more favorable than Intuit.

Risk and Volatility

QAD has a beta of 0.84, meaning that its stock price is 16% less volatile than the S&P 500. Comparatively, Intuit has a beta of 1.18, meaning that its stock price is 18% more volatile than the S&P 500.

Profitability

This table compares QAD and Intuit’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
QAD -5.98% -0.48% -0.21%
Intuit 18.76% 82.43% 22.68%

Dividends

QAD pays an annual dividend of $0.24 per share and has a dividend yield of 0.8%. Intuit pays an annual dividend of $1.56 per share and has a dividend yield of 1.0%. QAD pays out -25.5% of its earnings in the form of a dividend. Intuit pays out 41.9% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Summary

Intuit beats QAD on 11 of the 15 factors compared between the two stocks.

About QAD

QAD Inc. (QAD) is a provider of vertically oriented enterprise software solutions for global manufacturing companies across the automotive, life sciences, consumer products, food and beverage, high technology and industrial products industries. QAD Enterprise Applications enables measurement and control of business processes and supports operational requirements, including financials, manufacturing, demand and supply chain planning, customer management, business intelligence and business process management. QAD delivers components of its solution for a range of mobile platforms. The Company’s mobile suite includes a requisition approval solution, a mobile business intelligence solution, mobile browse capability and mobile application monitoring tools to support system administrators. Its mobile browse capability allows users to view, filter and sort data accessible through QAD Browses within QAD Enterprise Applications using mobile devices.

About Intuit

Intuit Inc. is a provider of business and financial management solutions for small businesses, consumers and accounting professionals. The Company operates through three segments: Small Business, Consumer Tax and ProConnect. The Small Business segment serves and advises small businesses and the accounting professionals, and includes QuickBooks financial and business management online services and desktop software, payroll solutions, and payment processing solutions. The Small Business segment also includes third-party applications that integrate with the Company’s offerings. The Consumer Tax segment targets consumers and includes TurboTax products and services, which enable individuals to prepare and file their own federal and state personal income tax returns. The ProConnect segment targets professional accountants in the United States and Canada. Its ProConnect professional tax offerings include Lacerte, ProSeries, ProFile and ProConnect Tax Online.

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