Comparing Gartner (NYSE:IT) & Resources Connection (NASDAQ:RGP)

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

Risk and Volatility

Resources Connection has a beta of 0.53, meaning that its share price is 47% 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.

Valuation & Earnings

This table compares Resources Connection and Gartner”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Resources Connection	$452.01 million	0.29	-$40.60 million	($1.20)	-3.16
Gartner	$6.50 billion	1.82	$729.23 million	$11.15	16.83

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

Institutional and Insider Ownership

93.2% of Resources Connection shares are held by institutional investors. Comparatively, 91.5% of Gartner shares are held by institutional investors. 5.5% of Resources Connection shares are held by insiders. Comparatively, 2.6% of Gartner shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Resources Connection	-8.98%	-4.63%	-3.16%
Gartner	11.99%	525.46%	13.45%

Analyst Ratings

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

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Resources Connection	1	1	1	0	2.00
Gartner	2	6	2	1	2.18

Gartner has a consensus price target of $187.30, suggesting a potential downside of 0.20%. Given Gartner’s stronger consensus rating and higher possible upside, analysts clearly believe Gartner is more favorable than Resources Connection.

Summary

Gartner beats Resources Connection on 13 of the 15 factors compared between the two stocks.

About Resources Connection

Resources Connection, Inc. provides consulting services to business customers under the Resources Global Professionals name in North America, Europe, and the Asia Pacific. The company offers services in the areas of transactions, including integration and divestitures, bankruptcy/restructuring, going public readiness and support, financial process optimization, and system implementation; and regulations, such as accounting regulations, internal audit and compliance, data privacy and security, healthcare compliance, and regulatory compliance. It provides transformations services comprising finance transformation, digital transformation, supply chain management, cloud migration, and data design and analytics. The company was formerly known as RC Transaction Corp. and changed its name to Resources Connection, Inc. in August 2000. Resources Connection, Inc. was founded in 1996 and is headquartered in Irvine, California.

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.