IHS Markit (NASDAQ: INFO) and Donnelley Financial Solutions (NASDAQ:DFIN) are both business services companies, but which is the better business? We will compare the two companies based on the strength of their valuation, risk, analyst recommendations, profitability, institutional ownership, dividends and earnings.

Profitability

This table compares IHS Markit and Donnelley Financial Solutions’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
IHS Markit 6.66% 7.33% 4.15%
Donnelley Financial Solutions 6.48% 51.81% 7.57%

Analyst Ratings

This is a summary of current ratings and recommmendations for IHS Markit and Donnelley Financial Solutions, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
IHS Markit 1 3 6 0 2.50
Donnelley Financial Solutions 0 3 1 0 2.25

IHS Markit presently has a consensus price target of $45.67, suggesting a potential downside of 2.36%. Donnelley Financial Solutions has a consensus price target of $24.33, suggesting a potential upside of 13.18%. Given Donnelley Financial Solutions’ higher probable upside, analysts clearly believe Donnelley Financial Solutions is more favorable than IHS Markit.

Valuation and Earnings

This table compares IHS Markit and Donnelley Financial Solutions’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
IHS Markit $3.35 billion 5.58 $973.60 million $0.52 89.94
Donnelley Financial Solutions $1.00 billion 0.72 $140.60 million N/A N/A

IHS Markit has higher revenue and earnings than Donnelley Financial Solutions.

Summary

IHS Markit beats Donnelley Financial Solutions on 7 of the 10 factors compared between the two stocks.

IHS Markit Company Profile

IHS Markit Ltd., formerly Markit Ltd., is a provider of critical information and analytics for the major industries, financial markets and governments. The Company operates through four segments: Resources, Transportation, Consolidated Markets & Solutions (CMS) and Financial Services. The Resources segment includes its energy and chemicals product offerings. Its energy offerings are focused on upstream, midstream, downstream and power/gas/coal/renewables (PGCR) services. The Transportation segment includes its aerospace, defense and security (AD&S); automotive, and maritime and trade (M&T) product offerings. The CMS segment includes its product design; technology, media and telecommunication, and economics and country risk (ECR) product offerings. The Company’s Financial Services segment provides pricing and reference data, indices, valuation and trading services, trade processing, enterprise software and managed services.

Donnelley Financial Solutions Company Profile

Donnelley Financial Solutions, Inc. is a financial communications services company that supports global capital markets compliance and transaction needs for its corporate clients and their advisors (such as law firms and investment bankers), and global investment markets compliance and analytics needs for mutual fund companies, variable annuity providers and broker/dealers. The Company provides content management, multi-channel content distribution, data management and analytics services, collaborative workflow and business reporting tools, and translations and other language services in support of its clients’ communications requirements. The Company operates in two business segments: United States and International. The United States segment consists of three reporting units: capital markets, investment markets, and language solutions and other. The International segment includes its operations in Asia, Europe, Latin America and Canada.

Receive News & Stock Ratings for IHS Markit Ltd. Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for IHS Markit Ltd. and related stocks with our FREE daily email newsletter.