Head-To-Head Contrast: Rally Software Development (NYSE:RALY) versus Its Peers

Rally Software Development (NYSE: RALY) is one of 22 publicly-traded companies in the “Cloud Computing Services” industry, but how does it compare to its peers? We will compare Rally Software Development to related companies based on the strength of its risk, profitability, analyst recommendations, dividends, valuation, earnings and institutional ownership.

Institutional and Insider Ownership

59.4% of shares of all “Cloud Computing Services” companies are held by institutional investors. 21.0% of shares of all “Cloud Computing Services” companies are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Rally Software Development and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Rally Software Development -28.33% -54.33% -25.93%
Rally Software Development Competitors -86.37% -152.25% -21.24%

Analyst Ratings

This is a breakdown of current ratings and target prices for Rally Software Development and its peers, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Rally Software Development 0 0 0 0 N/A
Rally Software Development Competitors 104 499 1576 46 2.70

As a group, “Cloud Computing Services” companies have a potential upside of 6.61%. Given Rally Software Development’s peers higher possible upside, analysts plainly believe Rally Software Development has less favorable growth aspects than its peers.

Valuation & Earnings

This table compares Rally Software Development and its peers gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Rally Software Development N/A N/A -15.35
Rally Software Development Competitors $996.80 million -$34.68 million 670.85

Rally Software Development’s peers have higher revenue, but lower earnings than Rally Software Development. Rally Software Development is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Summary

Rally Software Development peers beat Rally Software Development on 6 of the 8 factors compared.

About Rally Software Development

Rally Software Development Corp. (Rally) is a United States-based company, which offers consulting and training services. The Company offers software as a service (SaaS) platform for organizations to manage the software development lifecycle. The Company’s solutions for Agile includes Agile University, which is an online source for Agile training, and Agile Commons, which is a collaborative Web community focused on software agility. The Company offers a range of Agile platform and products for Application Lifecycle Management (ALM). The Company’s solutions include enterprise scale agile, which consists of Flowdock and leading SAFe; analytics and metrics, which consists of Rally Insights Solution and Agile coaching; product and portfolio management, which include Agile Portfolio Management and transformation consulting, and Team Collaboration, which consists of Rally scrum team launch and test driven development. Its services include transformation consulting, training and coaching.

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