Science Applications International (NYSE: SAIC) and IMS Health (NYSE:IMS) are both mid-cap computer and technology companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, analyst recommendations, profitability, valuation, risk, institutional ownership and earnings.

Earnings and Valuation

This table compares Science Applications International and IMS Health’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Science Applications International $4.45 billion 0.75 $148.00 million $3.64 21.47
IMS Health N/A N/A N/A $0.42 74.62

Science Applications International has higher revenue and earnings than IMS Health. Science Applications International is trading at a lower price-to-earnings ratio than IMS Health, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Science Applications International and IMS Health, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Science Applications International 0 2 5 0 2.71
IMS Health 0 0 0 0 N/A

Science Applications International presently has a consensus price target of $79.57, indicating a potential upside of 1.83%. Given Science Applications International’s higher probable upside, analysts clearly believe Science Applications International is more favorable than IMS Health.

Insider & Institutional Ownership

64.1% of Science Applications International shares are held by institutional investors. Comparatively, 90.3% of IMS Health shares are held by institutional investors. 2.9% of Science Applications International shares are held by insiders. Comparatively, 2.5% of IMS Health shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Dividends

Science Applications International pays an annual dividend of $1.24 per share and has a dividend yield of 1.6%. IMS Health does not pay a dividend. Science Applications International pays out 34.1% of its earnings in the form of a dividend.

Profitability

This table compares Science Applications International and IMS Health’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Science Applications International 3.77% 50.26% 8.18%
IMS Health 2.99% 5.62% 1.22%

Summary

Science Applications International beats IMS Health on 9 of the 11 factors compared between the two stocks.

About Science Applications International

Science Applications International Corporation (SAIC) is a provider of technical, engineering and enterprise information technology (IT) services. The Company provides its services primarily to the United States Government, including the Department of Defense (DoD), the intelligence community and federal civilian agencies. The Company provides engineering, systems integration and information technology offerings for government projects, and offers a range of services with a targeted emphasis on higher-end, differentiated technology services. The Company’s offerings include engineering; technology and equipment platform integration; maintenance of ground and maritime systems; logistics; training and simulation; operation and program support services, and end-to-end services spanning the design, development, integration, deployment, management and operations, sustainment and security of its customers’ entire IT infrastructure.

About IMS Health

IMS Health Holdings, Inc. (IMS) is an information and technology services company that provides solutions to its clients in the healthcare industry. The Company has its presence in over 100 countries. The Company’s data set contains over 10 petabytes of data and over 500 million patient records. It serves healthcare organizations and life science companies, including pharmaceutical, biotechnology, consumer health and medical device manufacturers, as well as distributors, providers, payers, government agencies, policymakers, researchers and the financial community. The Company’s principal information offerings include national information offerings, sub-national information offerings and OneKey. Its technology services offerings include technology solutions, real-world evidence solutions, and workflow analytics and consulting services. It offers technology services that include data warehousing, information technology (IT) outsourcing, software applications and other services.

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