Proofpoint (NASDAQ: PFPT) and Jack Henry & Associates (NASDAQ:JKHY) are both mid-cap computer and technology companies, but which is the superior stock? We will compare the two companies based on the strength of their profitability, valuation, risk, analyst recommendations, earnings, dividends and institutional ownership.
This table compares Proofpoint and Jack Henry & Associates’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Jack Henry & Associates||17.08%||23.92%||13.64%|
This is a summary of current recommendations for Proofpoint and Jack Henry & Associates, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Jack Henry & Associates||0||3||1||0||2.25|
Proofpoint currently has a consensus price target of $102.41, suggesting a potential upside of 12.00%. Jack Henry & Associates has a consensus price target of $110.50, suggesting a potential downside of 5.43%. Given Proofpoint’s stronger consensus rating and higher probable upside, research analysts clearly believe Proofpoint is more favorable than Jack Henry & Associates.
Earnings and Valuation
This table compares Proofpoint and Jack Henry & Associates’ revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Proofpoint||$375.50 million||10.92||-$111.20 million||($2.21)||-41.38|
|Jack Henry & Associates||$1.43 billion||6.31||$245.79 million||$3.17||36.86|
Jack Henry & Associates has higher revenue and earnings than Proofpoint. Proofpoint is trading at a lower price-to-earnings ratio than Jack Henry & Associates, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
89.0% of Jack Henry & Associates shares are owned by institutional investors. 6.0% of Proofpoint shares are owned by company insiders. Comparatively, 0.8% of Jack Henry & Associates shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
Volatility and Risk
Proofpoint has a beta of 1.32, suggesting that its share price is 32% more volatile than the S&P 500. Comparatively, Jack Henry & Associates has a beta of 0.78, suggesting that its share price is 22% less volatile than the S&P 500.
Jack Henry & Associates pays an annual dividend of $1.24 per share and has a dividend yield of 1.1%. Proofpoint does not pay a dividend. Jack Henry & Associates pays out 39.1% of its earnings in the form of a dividend. Proofpoint has increased its dividend for 13 consecutive years.
Jack Henry & Associates beats Proofpoint on 9 of the 17 factors compared between the two stocks.
Proofpoint, Inc. is a security-as-a-service provider that enables large and mid-sized organizations to defend, protect, archive and govern their sensitive data. The Company’s security-as-a-service platform consists of an integrated suite of on-demand data protection solutions, including threat protection, incident response, regulatory compliance, archiving, governance, eDiscovery and secure communication. The Company’s solutions are built on a cloud-based platform. The Company provides a multi-tiered security-as-a-service platform, including solutions, platform technologies and infrastructure. Its product families include Email Security, Proofpoint Advanced Threat Protection, Proofpoint Information Protection and Archiving, and Proofpoint Digital Risk Protection. The Company’s platform services include Threat detection, Threat intel extraction, Nexus threat graph, Real-time detection, Information classification and Intelligent policy.
About Jack Henry & Associates
Jack Henry & Associates, Inc. is a provider of information processing solutions for community banks. The Company offers a range of products and services, including processing transactions, automating business processes, and managing information financial institutions and diverse corporate entities. It operates in two segments: bank systems and services (Bank) and credit union systems and services (Credit Union). It provides its products and services through approximately three business brands, which include Jack Henry Banking, Symitar and ProfitStars. The Core software system consists of the integrated applications required to process deposit, loan, and general ledger transactions, and to maintain centralized customer/member information. Jack Henry Banking markets over three software systems to banks and Symitar markets over two software systems to credit unions. Its subsidiaries include Jack Henry Services, Inc., Symitar Systems, Inc. and Bayside Business Solutions, Inc.
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