Contrasting Secom (OTCMKTS:SOMLY) and SGS (OTCMKTS:SGSOY)

Secom (OTCMKTS:SOMLY) and SGS (OTCMKTS:SGSOY) are both large-cap business services companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, risk, analyst recommendations, dividends, profitability, valuation and earnings.

Dividends

Secom pays an annual dividend of $0.10 per share and has a dividend yield of 1.1%. SGS pays an annual dividend of $0.18 per share and has a dividend yield of 1.7%. Secom pays out 23.3% of its earnings in the form of a dividend.

Profitability

This table compares Secom and SGS’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Secom	8.60%	7.50%	5.08%
SGS	N/A	N/A	N/A

Earnings & Valuation

This table compares Secom and SGS”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Secom	$7.88 billion	2.18	$713.52 million	$0.43	21.40
SGS	$8.38 billion	2.48	$806.28 million	N/A	N/A

SGS has higher revenue and earnings than Secom.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Secom and SGS, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Secom	0	0	0	0	0.00
SGS	1	2	1	3	2.86

Risk & Volatility

Secom has a beta of 0.29, suggesting that its stock price is 71% less volatile than the S&P 500. Comparatively, SGS has a beta of 0.74, suggesting that its stock price is 26% less volatile than the S&P 500.

Summary

SGS beats Secom on 9 of the 12 factors compared between the two stocks.

About Secom

SECOM CO., LTD., together with its subsidiaries, provides security services in Japan and internationally. The company operates through Security Services, Fire Protection Services, Medical Services, Insurance Services, Geospatial Information Services, BPO and ICT Services, and Other Services. The Security Services segment offers static guard, armored car, merchandise, and other services, as well as online security systems. The Fire Protection Services segment provides fire alarm systems, fire extinguishing systems, and maintenance services to office buildings, production facilities, tunnels, cultural properties, ships, and residences. The Medical Services segment offers home nursing, pharmaceutical dispensing, home delivery services, health and preventative care services, and personal and outpatient care services; and cloud-based medical reporting services and SECOM LINKus application. This segment also operates the general hospital and residences for seniors; and sells medical equipment and pharmaceuticals. The Insurance Services Segment provides fire insurance, automobile insurance, and cancer treatment insurance services. The Geospatial Information Services segment offers geospatial information services to public-sector entities, such as national and local governments; private sector customers; and overseas government agencies. The BPO and ICT Services segment provides contact centers and back office support services, data center, disaster preparedness, information security, and cloud-based services, as well as SaaS solutions. The Other Services segment offers real estate leasing, construction, and installation services. The company was incorporated in 1962 and is headquartered in Tokyo, Japan.

About SGS

SGS SA provides inspection, testing, and verification services in Europe, Africa, the Middle East, the Americas, and the Asia Pacific. It operates in five segments: Connectivity & Products, Health & Nutrition, Industries & Environment, Natural Resources, and Business Assurance. The company provides laboratory testing, product inspection and consulting, process assessment, technical and transactional assistance; and automotive, connectivity, softlines and accessories, and hardgoods, toys, and juvenile products, as well as government and trade facilitation services. In addition, it offers a range of testing, inspection and certification solutions for the crop science, food, health science, and cosmetics and hygiene industries; field services, technical assessment, and advisory services; and services related to industrial, public health and safety, environmental testing, and public mandates. Further, it provides assessment, auditing, and certification, supply chain assurance, training, consulting, and sustainability assurance services; agricultural commodities, geochemistry, laboratory testing petroleum and chemicals, metallurgy and consulting, mineral and metal commodities, and oil, gas, and chemical commodities; and sustainability solutions. The company serves the agriculture and food, chemical, construction, consumer and retail, energy, industrial manufacturing, life sciences, mining, oil and gas, public, and transportation sectors. SGS SA was founded in 1878 and is headquartered in Geneva, Switzerland.