Navigant Consulting (NYSE: NCI) and FTI Consulting (NYSE:FCN) are both small-cap business services companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, valuation, earnings, profitabiliy, analyst recommendations, dividends and institutional ownership.

Profitability

This table compares Navigant Consulting and FTI Consulting’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Navigant Consulting 4.97% 8.95% 5.39%
FTI Consulting 2.13% 5.18% 2.76%

Insider and Institutional Ownership

94.1% of Navigant Consulting shares are held by institutional investors. Comparatively, 96.4% of FTI Consulting shares are held by institutional investors. 2.4% of Navigant Consulting shares are held by insiders. Comparatively, 1.0% of FTI Consulting shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Navigant Consulting and FTI Consulting, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Navigant Consulting 0 0 1 0 3.00
FTI Consulting 0 3 0 0 2.00

Navigant Consulting presently has a consensus target price of $24.00, indicating a potential upside of 49.91%. FTI Consulting has a consensus target price of $43.00, indicating a potential upside of 32.47%. Given Navigant Consulting’s stronger consensus rating and higher possible upside, analysts clearly believe Navigant Consulting is more favorable than FTI Consulting.

Risk and Volatility

Navigant Consulting has a beta of 0.83, indicating that its share price is 17% less volatile than the S&P 500. Comparatively, FTI Consulting has a beta of 0.28, indicating that its share price is 72% less volatile than the S&P 500.

Valuation & Earnings

This table compares Navigant Consulting and FTI Consulting’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Navigant Consulting $948.24 million 0.80 $130.81 million $1.04 15.39
FTI Consulting $1.77 billion 0.73 $149.35 million $0.90 36.07

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

Summary

Navigant Consulting beats FTI Consulting on 10 of the 14 factors compared between the two stocks.

Navigant Consulting Company Profile

Navigant Consulting, Inc. is a global professional services company. The Company serves clients in the healthcare, energy and financial services industries. It operates through four segments. The Healthcare segment provides consulting services and business process management services. The Energy segment provides advisory solutions in business strategy and planning, distributed energy resources and renewables, energy efficiency and demand response and grid modernization The Financial Services Advisory and Compliance segment provides strategic, operational, valuation, risk management, investigative and compliance advisory services to clients primarily in the financial services industry. The Disputes, Forensics & Legal Technology segment offers professional services, including valuation and economic analysis, as well as accounting, regulatory, construction and computer forensic expertise.

FTI Consulting Company Profile

FTI Consulting, Inc. is a business advisory company. The Company operates through five segments: Corporate Finance & Restructuring, Forensic and Litigation Consulting, Economic Consulting, Technology and Strategic Communications. The Company provides advice and services, such as restructuring (including bankruptcy), capital formation and indebtedness, interim business management, performance improvements, forensic accounting and litigation matters, international arbitrations, mergers and acquisitions (M&A), antitrust and competition matters, securities litigation, electronic discovery (or e-discovery), management and retrieval of electronically stored information (ESI), reputation management and strategic communications. The Company collaborates with Chief Financial Officers (CFOs) and their finance and accounting organizations and uses engagement tools to provide transformation services, manage risk, deliver business intelligence capabilities, and prepare for and execute events.

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