Comparing ExlService (NASDAQ:EXLS) & Gartner (NYSE:IT)

ExlService (NASDAQ:EXLS) and Gartner (NYSE:IT) are both industrials companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, earnings, analyst recommendations, institutional ownership, profitability, valuation and risk.

Risk and Volatility

ExlService has a beta of 0.81, meaning that its share price is 19% less volatile than the S&P 500. Comparatively, Gartner has a beta of 0.96, meaning that its share price is 4% less volatile than the S&P 500.

Earnings & Valuation

This table compares ExlService and Gartner”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ExlService	$2.24 billion	2.43	$251.02 million	$1.59	22.55
Gartner	$6.50 billion	1.86	$729.23 million	$11.15	17.20

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

Institutional and Insider Ownership

92.9% of ExlService shares are owned by institutional investors. Comparatively, 91.5% of Gartner shares are owned by institutional investors. 3.7% of ExlService shares are owned by insiders. Comparatively, 2.6% of Gartner shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings and target prices for ExlService and Gartner, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ExlService	0	1	6	0	2.86
Gartner	2	6	2	1	2.18

ExlService currently has a consensus target price of $44.50, indicating a potential upside of 24.13%. Gartner has a consensus target price of $187.30, indicating a potential downside of 2.31%. Given ExlService’s stronger consensus rating and higher probable upside, research analysts plainly believe ExlService is more favorable than Gartner.

Profitability

This table compares ExlService and Gartner’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ExlService	11.17%	30.61%	15.66%
Gartner	11.99%	525.46%	13.45%

Summary

ExlService beats Gartner on 8 of the 15 factors compared between the two stocks.

About ExlService

ExlService Holdings, Inc. operates as a data analytics, and digital operations and solutions company in the United States and internationally. The company operates through Insurance, Healthcare, Analytics, and Emerging Business segments. It also provides digital operations and solutions and analytics-driven services, such as claims processing, premium and benefit administration, agency management, account reconciliation, policy research, underwriting support, new business acquisition, policy servicing, premium audit, surveys, billing and collection, commercial and residential survey, and customer service using digital technology, artificial intelligence, machine learning, and advanced automation; digital customer acquisition services using a software-as-a-service delivery model through LifePRO and LISS platforms; subrogation services; and Subrosource software platform, an end-to-end subrogation platform. In addition, the company offers health care services related to care management, utilization management, disease management, payment integrity, revenue optimization, and customer engagement. Further, it provides financial planning and analysis, management reporting, forecasting and decision support, data management, regulatory reporting and risk, and compliance services; reservations, customer, and fulfilment services; freight billing, collections, claims management, freight audit, freight scheduling, supply chain management, and revenue assurance services; residential mortgage lending, title verification and validation, retail banking and credit cards, trust verification, commercial banking, and investment management; merchandising, pricing, and demand forecasting; and digital operations and solutions. The company offers predictive and prescriptive analytics in the areas of customer acquisition and lifecycle management. ExlService Holdings, Inc. was founded in 1999 and is headquartered in New York, New York.

About Gartner

Gartner, Inc. operates as a research and advisory company in the United States, Canada, Europe, the Middle East, Africa, and internationally. It operates through three segments: Research, Conferences, and Consulting. The Research segment delivers its research primarily through a subscription service that include on-demand access to published research content, data and benchmarks, and direct access to a network of research experts. The Conferences segment offers executives and teams in an organization the opportunity to learn, share, and network. The Consulting segment offers market-leading research, custom analysis, and on-the-ground support services. This segment also offers actionable solutions for IT-related priorities, including IT cost optimization, digital transformation, and IT sourcing optimization. Gartner, Inc. was founded in 1979 and is headquartered in Stamford, Connecticut.