ITEX (OTCMKTS:ITEX) and Ritchie Bros. Auctioneers (NYSE:RBA) are both business services companies, but which is the superior stock? We will contrast the two companies based on the strength of their risk, profitability, earnings, dividends, valuation, analyst recommendations and institutional ownership.

Profitability

This table compares ITEX and Ritchie Bros. Auctioneers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ITEX N/A N/A N/A
Ritchie Bros. Auctioneers 9.90% 15.88% 5.91%

Dividends

ITEX pays an annual dividend of $0.20 per share and has a dividend yield of 5.0%. Ritchie Bros. Auctioneers pays an annual dividend of $0.80 per share and has a dividend yield of 1.9%. Ritchie Bros. Auctioneers pays out 74.1% of its earnings in the form of a dividend.

Earnings & Valuation

This table compares ITEX and Ritchie Bros. Auctioneers’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
ITEX N/A N/A N/A N/A N/A
Ritchie Bros. Auctioneers $1.17 billion 3.89 $121.48 million $1.08 38.90

Ritchie Bros. Auctioneers has higher revenue and earnings than ITEX.

Volatility & Risk

ITEX has a beta of 0.44, meaning that its stock price is 56% less volatile than the S&P 500. Comparatively, Ritchie Bros. Auctioneers has a beta of 0.69, meaning that its stock price is 31% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for ITEX and Ritchie Bros. Auctioneers, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ITEX 0 0 0 0 N/A
Ritchie Bros. Auctioneers 3 4 2 0 1.89

Ritchie Bros. Auctioneers has a consensus target price of $36.57, indicating a potential downside of 12.95%. Given Ritchie Bros. Auctioneers’ higher possible upside, analysts clearly believe Ritchie Bros. Auctioneers is more favorable than ITEX.

Institutional and Insider Ownership

91.4% of Ritchie Bros. Auctioneers shares are held by institutional investors. 32.0% of ITEX shares are held by insiders. Comparatively, 1.6% of Ritchie Bros. Auctioneers shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Summary

Ritchie Bros. Auctioneers beats ITEX on 8 of the 11 factors compared between the two stocks.

About ITEX

ITEX Corporation operates a marketplace in which products and services are exchanged by marketplace members without exchanging cash in the United States. The company's marketplace provides a forum for members to purchase from and sell their products and services to other members using ITEX dollars instead of United States dollars. It also administers the marketplace, as well as provides record-keeping and payment transaction processing services. In addition, the company services its member businesses through its independent licensed brokers and franchise network. ITEX Corporation was founded in 1982 and is headquartered in Bellevue, Washington.

About Ritchie Bros. Auctioneers

Ritchie Bros. Auctioneers Incorporated, an asset management and disposition company, sells industrial equipment and other durable assets through its unreserved live on site auctions, online marketplaces, listing services, and private brokerage services. The company sells a range of used and unused equipment, including earthmoving equipment, truck trailers, government surplus, oil and gas equipment, and other industrial assets, as well as construction and heavy machinery. It also offers live auction events with online bidding. The company sells used equipment to its customers through live, unreserved auctions at 40 auction sites worldwide. It serves construction, transportation, agriculture, energy, oil and gas, mining, and forestry sectors. The company operates in the United States, Canada, Australia, the United Arab Emirates, the Netherlands, and internationally. Ritchie Bros. Auctioneers Incorporated was founded in 1958 and is headquartered in Burnaby, Canada.

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