Amdocs (DOX) versus NCR (NYSE:NCR) Critical Review

Amdocs (NASDAQ: DOX) and NCR (NYSE:NCR) are both mid-cap technology companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, profitability, valuation, risk and earnings.

Analyst Ratings

This is a summary of current ratings and target prices for Amdocs and NCR, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Amdocs 0 4 2 0 2.33
NCR 0 2 6 0 2.75

Amdocs presently has a consensus price target of $70.17, indicating a potential upside of 5.62%. NCR has a consensus price target of $47.57, indicating a potential upside of 36.03%. Given NCR’s stronger consensus rating and higher probable upside, analysts clearly believe NCR is more favorable than Amdocs.

Profitability

This table compares Amdocs and NCR’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Amdocs 11.30% 14.77% 9.81%
NCR 5.11% 84.72% 7.25%

Insider & Institutional Ownership

92.1% of Amdocs shares are owned by institutional investors. Comparatively, 90.4% of NCR shares are owned by institutional investors. 15.4% of Amdocs shares are owned by company insiders. Comparatively, 1.0% of NCR shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Dividends

Amdocs pays an annual dividend of $0.88 per share and has a dividend yield of 1.3%. NCR does not pay a dividend. Amdocs pays out 29.7% of its earnings in the form of a dividend.

Valuation & Earnings

This table compares Amdocs and NCR’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Amdocs $3.87 billion 2.47 $436.82 million $2.96 22.44
NCR $6.54 billion 0.65 $270.00 million $1.46 23.95

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

Volatility & Risk

Amdocs has a beta of 0.53, suggesting that its share price is 47% less volatile than the S&P 500. Comparatively, NCR has a beta of 1.82, suggesting that its share price is 82% more volatile than the S&P 500.

Amdocs Company Profile

Amdocs Limited is a provider of software and services for communications, entertainment and media industry service providers. The Company develops, implements and manages software and services associated with business support systems (BSS), operational support systems (OSS) and network operations to enable service providers to introduce new products and services, process orders, monetize data, support new business models and enhance their understanding of their customers. The Company’s segment provides software products and services. Its services include strategic business consulting, systems integration and transformation, managed services and testing. Its managed services provide multi-year, flexible and tailored business processes and applications services, including application development and maintenance, information technology (IT) and infrastructure services, testing and professional services.

NCR Company Profile

NCR Corporation is a provider of Omni-channel technology solutions that enable businesses connect, interact and transact with their customers. The Company operates through three segments: Software, Services and Hardware. It sells a portfolio of hardware, software and services that combine to provide businesses with solutions. Its portfolio of self-service and assisted-service solutions are designed to allow businesses in the financial services, retail, hospitality, travel and telecommunications and technology industries to deliver an experience to consumers across physical and digital commerce channels. Its offerings include automated teller machines, point of sale terminals and devices, self-service kiosks, Omni-channel platform software and other software applications, and a suite of consulting, implementation, maintenance and managed services. It provides solutions for a range of industries, such as financial services, hospitality, travel and telecommunications, and technology.

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