ePlus (PLUS) vs. Tech Data (TECD) Financial Comparison

ePlus (NASDAQ: PLUS) and Tech Data (NASDAQ:TECD) are both computer and technology companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, risk, analyst recommendations, earnings, valuation, dividends and institutional ownership.

Profitability

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This table compares ePlus and Tech Data’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ePlus 4.01% 15.06% 7.34%
Tech Data 0.32% 12.83% 3.06%

Volatility and Risk

ePlus has a beta of 1.15, suggesting that its share price is 15% more volatile than the S&P 500. Comparatively, Tech Data has a beta of 0.86, suggesting that its share price is 14% less volatile than the S&P 500.

Institutional & Insider Ownership

91.3% of ePlus shares are held by institutional investors. Comparatively, 96.2% of Tech Data shares are held by institutional investors. 3.3% of ePlus shares are held by company insiders. Comparatively, 1.6% of Tech Data shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and target prices for ePlus and Tech Data, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ePlus 0 1 1 0 2.50
Tech Data 0 2 6 0 2.75

ePlus currently has a consensus target price of $75.00, suggesting a potential downside of 1.51%. Tech Data has a consensus target price of $110.29, suggesting a potential upside of 42.16%. Given Tech Data’s stronger consensus rating and higher possible upside, analysts plainly believe Tech Data is more favorable than ePlus.

Valuation and Earnings

This table compares ePlus and Tech Data’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
ePlus $1.33 billion 0.80 $50.55 million $3.74 20.36
Tech Data $36.78 billion 0.08 $116.64 million $9.11 8.52

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

ePlus Company Profile

ePlus inc., an engineering-centric technology solutions provider, provides information technology (IT) products and services, flexible leasing and financing solutions, and enterprise supply management in the United States. It operates through two segments, Technology and Financing. The Technology segment sells IT products, such as hardware, software, maintenance, software assurance, and services; and offers advanced professional and managed services, including data center infrastructure, networking, security, cloud, and collaboration, as well as ePlus managed, professional, security, staff augmentation, server and desktop support, and project management services. This segment also offers proprietary software products comprising OneSource IT, an online Web based software portal for customers purchasing IT equipment, software, and services; OneSource Procurement, a Web-based software tool to facilitate procurement of various assets; OneSource Asset Management, a software platform for managing and tracking corporate assets consisting of vendor maintenance contracts; and OneSource DigitalPaper, a document management software application. The Financing segment specializes in financing arrangements, including direct financing, sales-type and operating leases, notes receivable, and consumption based financing arrangements, as well as underwriting and management of IT equipment and assets. Its financing operations comprise sales, pricing, credit, contracts, accounting, and risk and asset management. This segment primarily finances IT equipment, such as accessories and software, communication-related equipment, and medical equipment. The company serves commercial entities, state and local governments, government contractors, and educational institutions. The company was formerly known as MLC Holdings, Inc. and changed its name to ePlus inc. in 1999. ePlus inc. was founded in 1990 and is headquartered in Herndon, Virginia.

Tech Data Company Profile

Tech Data Corporation is a wholesale distributor of technology products. The Company serves as a link in the technology supply chain by bringing products from the technology vendors to market, as well as providing its customers with logistics capabilities and services. It operates through the segment of distributing technology products, logistics management and other value-added services. It operates in two geographic segments: the Americas and Europe. It provides resellers training and technical support suite of electronic commerce tools customized shipping documents product configuration or integration services and access to financing programs. Its customers include value-added resellers, direct marketers, retailers and corporate resellers who support the diverse technology needs of end users. It sells its products to customers in approximately 100 countries throughout North America, South America, Europe, the Middle East and Africa.

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