Head to Head Comparison: Pegasystems (NASDAQ:PEGA) & Manhattan Associates (NASDAQ:MANH)

Manhattan Associates (NASDAQ:MANH) and Pegasystems (NASDAQ:PEGA) are both large-cap computer and technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their valuation, dividends, institutional ownership, profitability, analyst recommendations, earnings and risk.

Volatility & Risk

Manhattan Associates has a beta of 1.02, indicating that its stock price is 2% more volatile than the S&P 500. Comparatively, Pegasystems has a beta of 1.08, indicating that its stock price is 8% more volatile than the S&P 500.

Valuation & Earnings

This table compares Manhattan Associates and Pegasystems”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Manhattan Associates	$1.04 billion	9.67	$218.36 million	$3.51	47.66
Pegasystems	$1.50 billion	6.35	$99.19 million	$1.49	37.62

Manhattan Associates has higher earnings, but lower revenue than Pegasystems. Pegasystems is trading at a lower price-to-earnings ratio than Manhattan Associates, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current recommendations and price targets for Manhattan Associates and Pegasystems, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Manhattan Associates	0	6	7	1	2.64
Pegasystems	0	2	9	0	2.82

Manhattan Associates currently has a consensus price target of $222.42, indicating a potential upside of 32.96%. Pegasystems has a consensus price target of $70.05, indicating a potential upside of 24.96%. Given Manhattan Associates’ higher probable upside, analysts plainly believe Manhattan Associates is more favorable than Pegasystems.

Profitability

This table compares Manhattan Associates and Pegasystems’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Manhattan Associates	20.25%	78.80%	29.95%
Pegasystems	16.05%	43.49%	18.42%

Insider and Institutional Ownership

98.5% of Manhattan Associates shares are owned by institutional investors. Comparatively, 46.9% of Pegasystems shares are owned by institutional investors. 0.9% of Manhattan Associates shares are owned by insiders. Comparatively, 49.7% of Pegasystems shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Summary

Manhattan Associates beats Pegasystems on 10 of the 15 factors compared between the two stocks.

About Manhattan Associates

Manhattan Associates, Inc. develops, sells, deploys, services, and maintains software solutions to manage supply chains, inventory, and omni-channel operations. It offers Warehouse Management Solution for managing goods and information across the distribution centers; Manhattan Active Warehouse Management, a cloud native and version less application for the associate; and Transportation Management Solution for helping shippers navigate their way through the demands and meet customer service expectations at the lowest possible freight costs; Manhattan SCALE, a portfolio of logistics execution solution; and Manhattan Active Omni, which offers order management, store inventory and fulfillment, POS, and customer engagement tools for enterprises and stores. The company also provides inventory optimization and allocation solutions; technology platform including Manhattan Active Platform solutions, a cloud-native product designed to provide version-less product access; maintenance services, which offers on-premises software licensees with software upgrades for additional or improved functionality and technological advances; and professional services, such as solutions planning and implementation, and related consulting services. In addition, it provides training and change management services; and resells computer hardware, radio frequency terminal networks, radio frequency identification chip readers, bar code printers and scanners, and other peripherals. The company offers products through direct sales personnel and partnership agreements with various organizations. It serves retail, consumer goods, food and grocery, logistics service providers, industrial and wholesale, high technology and electronics, life sciences, and government industries. The company operates in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. Manhattan Associates, Inc. was founded in 1990 and is headquartered in Atlanta, Georgia.

About Pegasystems

Pegasystems Inc. develops, markets, licenses, hosts, and supports enterprise software in the United States, rest of the Americas, the United Kingdom, rest of Europe, the Middle East, Africa, and the Asia-Pacific. The company provides Pega Infinity, a software portfolio comprising of Pega Customer Decision Hub, a real-time AI-powered decision engine to enhance customer acquisition and experiences across inbound, outbound, and paid media channels; Pega Customer Service to anticipate customer needs, connect customers to people and systems, and automate customer interactions to evolve the customer service experience, as well as to allow enterprises to deliver interactions across channels and enhance employee productivity; and Pega Platform, an intelligent automation software for increasing efficiency of clients’ processes and workflows. It also offers Situational Layer Cake that organizes logic into layers that map to the unique dimensions of a client’s business, such as customer types, lines of business, geographies, etc.; Pega Express Methodology and low code that connects enterprise data and systems to customer experience channels; Pega Cloud that allows clients to develop, test, and deploy applications; Pega Catalyst, which helps clients to transform and prototype their customer journeys; Pega Academy, which offers instructor-led and online training to its employees, clients, and partners; and global service assurance and client support services. It primarily markets its software and services to financial services, healthcare, communications and media, government, insurance, manufacturing and high tech, and consumer services markets through a direct sales force, as well as partnerships with technology providers and application developers. Pegasystems Inc. was incorporated in 1983 and is headquartered in Cambridge, Massachusetts.