Contrasting CA (CA) & Hortonworks (HDP)

CA (NASDAQ:CA) and Hortonworks (NASDAQ:HDP) are both computer and technology companies, but which is the better business? We will contrast the two businesses based on the strength of their earnings, risk, valuation, profitability, analyst recommendations, institutional ownership and dividends.

Profitability

This table compares CA and Hortonworks’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CA 11.19% 15.11% 7.46%
Hortonworks -49.78% N/A -57.11%

Analyst Recommendations

This is a breakdown of current ratings and target prices for CA and Hortonworks, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CA 0 7 0 0 2.00
Hortonworks 0 1 9 0 2.90

CA presently has a consensus target price of $37.83, suggesting a potential downside of 14.87%. Hortonworks has a consensus target price of $28.28, suggesting a potential upside of 92.63%. Given Hortonworks’ stronger consensus rating and higher possible upside, analysts plainly believe Hortonworks is more favorable than CA.

Valuation & Earnings

This table compares CA and Hortonworks’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
CA $4.24 billion 4.39 $476.00 million $2.32 19.16
Hortonworks $261.81 million 4.72 -$204.50 million ($3.06) -4.80

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

Institutional and Insider Ownership

69.7% of CA shares are held by institutional investors. Comparatively, 80.9% of Hortonworks shares are held by institutional investors. 0.9% of CA shares are held by company insiders. Comparatively, 15.6% of Hortonworks shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Risk and Volatility

CA has a beta of 0.73, suggesting that its stock price is 27% less volatile than the S&P 500. Comparatively, Hortonworks has a beta of 1.56, suggesting that its stock price is 56% more volatile than the S&P 500.

Dividends

CA pays an annual dividend of $1.02 per share and has a dividend yield of 2.3%. Hortonworks does not pay a dividend. CA pays out 44.0% of its earnings in the form of a dividend. CA has increased its dividend for 3 consecutive years.

Summary

CA beats Hortonworks on 9 of the 17 factors compared between the two stocks.

CA Company Profile

CA, Inc., doing business as CA technologies, develops, markets, delivers, and licenses software products and services in the United States and internationally. It operates through three segments: Mainframe Solutions, Enterprise Solutions, and Services. The Mainframe Solutions segment offers solutions for the IBM z Systems platform, which runs various mission critical business applications. Its mainframe solutions enable customers enhance economics by increasing throughput and lowering cost per transaction; increasing business agility through DevOps tooling and processes; increasing reliability and availability of operations through machine intelligence and automation solutions; and protecting enterprise data with security and compliance. The Enterprise Solutions segment provides a range of software planning, development, and management tools for mobile, cloud, and distributed computing environments. It primarily provides customers secure application development, infrastructure management, automation, and identity-centric security solutions. The Services segment offers various services, such as consulting, implementation, application management, education, and support services to commercial and government customers for implementation and adoption of its software solutions. The company serves banks, insurance companies, other financial services providers, government agencies, information technology service providers, telecommunication providers, transportation companies, manufacturers, technology companies, retailers, educational organizations, and health care institutions. It sells its products through direct sales force, as well as through various partner channels comprising resellers, service providers, system integrators, managed service providers, and technology partners. The company was formerly known as Computer Associates International, Inc. and changed its name to CA, Inc. in 2006. CA, Inc. was founded in 1974 and is headquartered in New York, New York.

Hortonworks Company Profile

Hortonworks, Inc. provides data management platforms, services, and solutions in North America, the Asia Pacific, Europe, and Latin America. It offers Hortonworks Data Platform (HDP), an enterprise-scale data management platform which provides a platform for multi-workload data processing; Hortonworks DataFlow, a data-in-motion platform to automate and secure Internet of anything data flows, as well as to collect, conduct, and curate real-time business insights and actions derived from data in motion, including sensors, machines, geolocation devices, clicks, server logs, and social feeds; and Hortonworks DataPlane Service simplifies managing, securing, governing, provisioning, and consuming distributed data systems. The company also provides Azure HDInsight, a data cloud service that provides customers flexible big data environments on the Azure cloud; Hortonworks Data Cloud for Amazon Web Services, a big data cloud service for analyzing and processing data, and enabling businesses to achieve insights quickly and with flexibility; Hortonworks Cybersecurity Platform (HCP) offers view of business risk through a security lens; and Hortonworks Sandbox, a personal, portable, and free to use Hadoop environment designed to offer the easiest way to get started with HDP or HDF. In addition, it offers support subscription, consulting, and education services. Further, the company's connected data platforms are primarily provided under the Apache open source license with rights to use, copy, modify, and redistribute the software. It sells its products through direct sales team and reseller partners. Hortonworks, Inc. was founded in 2011 and is headquartered in Santa Clara, California.

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