Contrasting American Software (AMSWA) and DealerTrack Technologies (TRAK)

DealerTrack Technologies (NASDAQ: TRAK) and American Software (NASDAQ:AMSWA) are both technology companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, valuation, analyst recommendations, risk, earnings, dividends and institutional ownership.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for DealerTrack Technologies and American Software, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
DealerTrack Technologies 0 0 0 0 N/A
American Software 0 0 1 0 3.00

American Software has a consensus target price of $14.00, suggesting a potential upside of 8.44%.

Profitability

This table compares DealerTrack Technologies and American Software’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
DealerTrack Technologies -3.45% -3.48% -1.59%
American Software 16.73% 17.27% 12.22%

Earnings & Valuation

This table compares DealerTrack Technologies and American Software’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
DealerTrack Technologies N/A N/A N/A ($0.67) N/A
American Software $106.29 million 3.66 $14.62 million $0.57 22.65

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

Dividends

American Software pays an annual dividend of $0.44 per share and has a dividend yield of 3.4%. DealerTrack Technologies does not pay a dividend. American Software pays out 77.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Insider and Institutional Ownership

74.7% of American Software shares are held by institutional investors. 13.9% of American Software shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

American Software beats DealerTrack Technologies on 9 of the 10 factors compared between the two stocks.

About DealerTrack Technologies

Dealertrack Technologies, Inc. provides Web-based software solutions and services. The Company provides solutions and services for segments of the automotive retail industry, including dealers, lenders, original equipment manufacturers (OEMs), third-party retailers, aftermarket providers and other service providers. Dealertrack operates the online credit application networks in the United States and Canada. The Company’s solutions includes Digital Marketing solutions, Dealer Management solutions, F&I solutions, Inventory solutions, Registration & Titling solutions, and Collateral Management solutions. Digital Marketing solutions include digital marketing tools, such as desktop and mobile Website design, search engine optimization (SEO), search engine marketing (SEM), social media and reputation management tools. Registration & Titling solutions include online and cross-state vehicle registration services.

About American Software

American Software, Inc. (American Software) develops, markets and supports a portfolio of software and services that delivers enterprise management, supply chain and retail planning solutions to the marketplace. The Company operates through three business segments: Supply Chain Management (SCM), Enterprise Resource Planning (ERP) and Information Technology (IT) Consulting. The SCM segment consists of Logility, Inc. and its subsidiary, Demand Management, Inc. (DMI), both of which provide supply chain and retail planning solutions to trading partners. The ERP segment consist of American Software ERP, which provides business software for manufacturers and distributors, and New Generation Computing, Inc. (NGC), which provides industry-specific business software to both retailers and manufacturers in the apparel, footwear, sewn products and furniture industries. The IT Consulting segment consists of The Proven Method, Inc., an IT staffing and consulting services firm.

Receive News & Ratings for DealerTrack Technologies Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for DealerTrack Technologies and related companies with MarketBeat.com's FREE daily email newsletter.

Leave a Reply