Critical Survey: The Providence Service (PRSC) versus MakeMyTrip (MMYT)

The Providence Service (NASDAQ: PRSC) and MakeMyTrip (NASDAQ:MMYT) are both consumer discretionary companies, but which is the better business? We will contrast the two companies based on the strength of their risk, analyst recommendations, valuation, institutional ownership, earnings, profitability and dividends.

Profitability

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This table compares The Providence Service and MakeMyTrip’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
The Providence Service 2.58% 7.53% 3.24%
MakeMyTrip -38.95% -12.00% -10.85%

Analyst Recommendations

This is a summary of current recommendations and price targets for The Providence Service and MakeMyTrip, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
The Providence Service 0 0 1 0 3.00
MakeMyTrip 0 1 2 0 2.67

The Providence Service presently has a consensus target price of $67.00, indicating a potential downside of 8.08%. MakeMyTrip has a consensus target price of $34.00, indicating a potential downside of 4.14%. Given MakeMyTrip’s higher probable upside, analysts plainly believe MakeMyTrip is more favorable than The Providence Service.

Insider & Institutional Ownership

97.7% of The Providence Service shares are owned by institutional investors. Comparatively, 47.0% of MakeMyTrip shares are owned by institutional investors. 18.9% of The Providence Service shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Risk & Volatility

The Providence Service has a beta of 0.8, indicating that its share price is 20% less volatile than the S&P 500. Comparatively, MakeMyTrip has a beta of -0.07, indicating that its share price is 107% less volatile than the S&P 500.

Valuation & Earnings

This table compares The Providence Service and MakeMyTrip’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
The Providence Service $1.62 billion 0.58 $53.36 million $1.65 44.18
MakeMyTrip $447.62 million 7.26 -$110.16 million ($1.88) -18.87

The Providence Service has higher revenue and earnings than MakeMyTrip. MakeMyTrip is trading at a lower price-to-earnings ratio than The Providence Service, indicating that it is currently the more affordable of the two stocks.

Summary

The Providence Service beats MakeMyTrip on 11 of the 14 factors compared between the two stocks.

The Providence Service Company Profile

The Providence Service Corporation (Providence) is a holding company. The Company, through its subsidiaries, is engaged in the provision of healthcare and workforce development services for public and private sector entities. The Company’s segments include Non-Emergency Transportation Services (NET Services), Workforce Development Services (WD Services) and Matrix Investment. NET Services segment includes nationwide provider of non-emergency medical transportation programs for state governments and managed care organizations. WD Services segment is a global provider of employment preparation and placement and legal offender rehabilitation services to eligible participants of government sponsored programs. Matrix Investment segment includes minority interest in nationwide provider of in-home care optimization and management solutions, including comprehensive health assessments (CHAs), to members of managed care organizations, accounted for as an equity method investment.

MakeMyTrip Company Profile

MakeMyTrip Limited, an online travel company, provides travel products and solutions in India and internationally. MakeMyTrip Limited, an online travel company, engages in the business of selling travel products and solutions in India, the United States, the Netherlands, Singapore, Malaysia, Thailand, the United Arab Emirates, Peru, Hong Kong, and Bangladesh. It operates through two segments, Air Ticketing, and Hotels and Packages. The company's services and products include air tickets, hotels, packages, rail tickets, bus tickets, and car hire, as well as ancillary travel requirements, such as facilitating access to travel insurance and visa processing. It allows travelers to research, plan, book, and purchase a range of travel services and products through its Websites makemytrip.com, makemytrip.ae, makemytrip.com.sg, us.makemytrip.com, hoteltravel.com, and easytobook.com; and other technology-enhanced distribution channels, including call centers, travel stores, and travel agents' network, as well as mobile service platform. As of March 31, 2017, the company had 16 company-owned travel stores and 35 franchisee-owned travel stores. MakeMyTrip Limited serves leisure travelers and small businesses. The company was founded in 2000 and is based in Gurgaon, India.

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