Critical Analysis: Verisk Analytics (NASDAQ:VRSK) & HireQuest (NASDAQ:HQI)

HireQuest (NASDAQ:HQI) and Verisk Analytics (NASDAQ:VRSK) are both industrials companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, risk, analyst recommendations, dividends, valuation, earnings and profitability.

Institutional & Insider Ownership

12.0% of HireQuest shares are owned by institutional investors. Comparatively, 90.0% of Verisk Analytics shares are owned by institutional investors. 42.9% of HireQuest shares are owned by company insiders. Comparatively, 0.5% of Verisk Analytics shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Volatility & Risk

HireQuest has a beta of 1.11, meaning that its stock price is 11% more volatile than the S&P 500. Comparatively, Verisk Analytics has a beta of 0.67, meaning that its stock price is 33% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and price targets for HireQuest and Verisk Analytics, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
HireQuest	0	1	2	0	2.67
Verisk Analytics	0	8	6	1	2.53

HireQuest presently has a consensus target price of $19.00, suggesting a potential upside of 16.00%. Verisk Analytics has a consensus target price of $236.27, suggesting a potential upside of 23.20%. Given Verisk Analytics’ higher probable upside, analysts clearly believe Verisk Analytics is more favorable than HireQuest.

Earnings and Valuation

This table compares HireQuest and Verisk Analytics”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
HireQuest	$30.64 million	7.43	$6.33 million	$0.57	28.74
Verisk Analytics	$3.07 billion	8.12	$908.30 million	$6.51	29.46

Verisk Analytics has higher revenue and earnings than HireQuest. HireQuest is trading at a lower price-to-earnings ratio than Verisk Analytics, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares HireQuest and Verisk Analytics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
HireQuest	27.06%	16.35%	12.11%
Verisk Analytics	28.24%	-239.55%	18.56%

Dividends

HireQuest pays an annual dividend of $0.24 per share and has a dividend yield of 1.5%. Verisk Analytics pays an annual dividend of $2.00 per share and has a dividend yield of 1.0%. HireQuest pays out 42.1% of its earnings in the form of a dividend. Verisk Analytics pays out 30.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Verisk Analytics has increased its dividend for 6 consecutive years.

Summary

Verisk Analytics beats HireQuest on 13 of the 18 factors compared between the two stocks.

About HireQuest

HireQuest, Inc. provides temporary staffing services in the United States. It offers staffing services, including direct-dispatch, executive search, consultant, unskilled and semi-skilled industrial and construction personnel, clerical and administrative personnel, and permanent placement services, as well as commercial and non-CDL drivers, and skilled personnel in the medical and dental industries. The company provides its services under the HireQuest Direct, HireQuest, SNelling, DriverQuest, HireQuest Health, Northbound Executive Search, and MRI trade names. It serves construction, recycling, warehousing, logistics, auctioneering, manufacturing, hospitality, landscaping, and retail industries, as well as dental practices. HireQuest, Inc. was founded in 2002 and is headquartered in Goose Creek, South Carolina.

About Verisk Analytics

Verisk Analytics, Inc. provides data analytics and technology solutions to the insurance markets in the United States and internationally. It offers policy language, prospective loss costs, policy writing and rating rules, and various underwriting solutions for risk selection and segmentation, pricing, and workflow optimization; property- and auto- specific rating and underwriting information solutions that allows clients to understand, quantify, underwrite, mitigate, and avoid potential loss for risks; catastrophe modeling solutions, which enables companies to identify, quantify, and plan for the financial consequences of catastrophes for use by insurers, reinsurers, intermediaries, financial institutions, and governments. The company also provides life insurance solutions for transforming current workflows in life insurance underwriting, claim insights, policy administration, unclaimed property/equity, compliance and fraud detection, and actuarial and portfolio modeling; Marketing Solutions, such as compliant, real-time decisioning, profitability, and risk assessment for inbound consumer interactions; and international underwriting and claims solutions. In addition, it offers claims insurance solutions, which provides analytics in fraud detection, compliance reporting, subrogation liability assessment, litigation, and repair cost estimation and valuation solutions; and casualty solutions, such as compliance, casualty claims decision support, and workflow automation solutions. Further, the company supplies software to the specialty insurance market. The company was founded in 1971 and is headquartered in Jersey City, New Jersey.