Everi Holdings (NYSE: EVRI) and Resources Connection (NASDAQ:RECN) are both small-cap business services companies, but which is the superior investment? We will contrast the two businesses based on the strength of their dividends, risk, analyst recommendations, earnings, profitability, institutional ownership and valuation.

Earnings and Valuation

This table compares Everi Holdings and Resources Connection’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Everi Holdings $919.45 million 0.57 $200.09 million ($3.75) -2.08
Resources Connection $583.41 million 0.62 $41.75 million $0.55 22.18

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

Dividends

Resources Connection pays an annual dividend of $0.48 per share and has a dividend yield of 3.9%. Everi Holdings does not pay a dividend. Resources Connection pays out 87.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Volatility & Risk

Everi Holdings has a beta of 1.07, suggesting that its share price is 7% more volatile than the S&P 500. Comparatively, Resources Connection has a beta of 1.21, suggesting that its share price is 21% more volatile than the S&P 500.

Insider & Institutional Ownership

85.5% of Everi Holdings shares are held by institutional investors. Comparatively, 82.2% of Resources Connection shares are held by institutional investors. 4.5% of Everi Holdings shares are held by insiders. Comparatively, 8.6% of Resources Connection shares are held by 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.

Profitability

This table compares Everi Holdings and Resources Connection’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Everi Holdings -26.95% -16,159.62% -16.89%
Resources Connection 3.20% 8.08% 5.76%

Analyst Ratings

This is a breakdown of recent recommendations for Everi Holdings and Resources Connection, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Everi Holdings 0 0 3 0 3.00
Resources Connection 1 2 0 0 1.67

Everi Holdings currently has a consensus target price of $7.00, indicating a potential downside of 10.26%. Resources Connection has a consensus target price of $13.50, indicating a potential upside of 10.66%. Given Resources Connection’s higher possible upside, analysts plainly believe Resources Connection is more favorable than Everi Holdings.

Summary

Resources Connection beats Everi Holdings on 9 of the 15 factors compared between the two stocks.

About Everi Holdings

Everi Holdings Inc. is a holding company. The Company operates through subsidiaries, including Everi Games Holding Inc. (Everi Games Holding) and Everi Payments Inc. (Everi Payments or Payments). The Company operates through two segments: Games and Payments. The Company provides video and mechanical reel gaming content and technology solutions, integrated gaming payments solutions, and compliance and efficiency software. Its games segment provides solutions directly to gaming establishments to offer its patrons gaming entertainment related experiences. The Payments segment provides solutions directly to gaming establishments to offer their patrons cash access related services and products, including access to cash at gaming facilities through automatic teller machine (ATM) cash withdrawals, credit card cash access transactions and point of sale debit card transactions.

About Resources Connection

Resources Connection, Inc. is a multinational consulting firm. The Company’s operating entities primarily provide services under the name Resources Global Professionals (RGP). The Company provides consulting and business initiative support services to its global client base in the areas of accounting; finance; corporate governance, risk and compliance (GRC) management; corporate advisory, strategic communications and restructuring; information management; human capital; supply chain management, and legal and regulatory. The Company provides its services and solutions to a client base in a range of industries. Its finance and accounting services encompass accounting operations, financial reporting, internal controls, financial analyses and business transactions. It offers a range of technology solutions, which include enterprise resource planning systems; strategic front-of-the-house systems; human resources (HR) information systems, and supply chain management systems, among others.

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