WNS (NYSE:WNS) and Stamps.com (NASDAQ:STMP) are both business services companies, but which is the better investment? We will compare the two companies based on the strength of their profitability, valuation, earnings, dividends, institutional ownership, risk and analyst recommendations.
Risk and Volatility
WNS has a beta of 1.08, suggesting that its share price is 8% more volatile than the S&P 500. Comparatively, Stamps.com has a beta of 0.4, suggesting that its share price is 60% less volatile than the S&P 500.
Valuation & Earnings
This table compares WNS and Stamps.com’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|WNS||$758.00 million||3.61||$86.43 million||$1.81||29.78|
|Stamps.com||$586.93 million||2.57||$168.64 million||$9.84||8.48|
Stamps.com has lower revenue, but higher earnings than WNS. Stamps.com is trading at a lower price-to-earnings ratio than WNS, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
84.7% of WNS shares are owned by institutional investors. Comparatively, 97.5% of Stamps.com shares are owned by institutional investors. 6.2% of Stamps.com shares are owned 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.
This table compares WNS and Stamps.com’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a summary of recent ratings and recommmendations for WNS and Stamps.com, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
WNS currently has a consensus target price of $61.60, suggesting a potential upside of 14.29%. Stamps.com has a consensus target price of $149.20, suggesting a potential upside of 78.90%. Given Stamps.com’s higher possible upside, analysts clearly believe Stamps.com is more favorable than WNS.
Stamps.com beats WNS on 8 of the 15 factors compared between the two stocks.
WNS Company Profile
WNS (Holdings) Limited, a business process management company, together with its subsidiaries, provides data, voice, analytical, and business transformation services worldwide. It operates through two segments, WNS Global BPM and WNS Auto Claims BPM. The company offers industry-specific services to clients primarily in insurance; travel and leisure; diversified businesses, including manufacturing, retail, consumer packaged goods, media and entertainment, and telecommunication; utilities; consulting and professional services; healthcare; banking and financial services; and shipping and logistics industries. It also provides shared services, such as customer interaction, finance and accounting, research and analytics, technology, legal, and human resources outsourcing services. In addition, the company offers transformation services designed to help its clients to modify their business processes to enhance productivity, as well as manage changes in the business environment and leverage business knowledge to increase market competitiveness. Further, it provides claims handling and repair management services for automobile repairs through a network of third party repair centers; and a suite of accident management services, such as credit hire and credit repair. WNS (Holdings) Limited was founded in 1996 and is based in Mumbai, India.
Stamps.com Company Profile
Stamps.com Inc. provides Internet-based mailing and shipping solutions in the United States and Europe. The company offers mailing and shipping solutions to mail and ship various mail pieces and packages through the United States Postal Service (USPS) under the Stamps.com and Endicia brands. Its solutions support various USPS mail classes, including First Class Mail, Priority Mail, Priority Mail Express, Media Mail, Parcel Select, and others. The company’s USPS mailing and shipping solutions enable users to print electronic postage directly onto envelopes, plain paper, or labels using personal computer, printer, and Internet connection. It also provides multi carrier shipping solutions under the MetaPack, ShipStation, ShipWorks, and ShippingEasy brands; mailing and shipping integration solutions comprising electronic postage for transactions to partners who manage the front-end process; branded insurance to insure mails or packages; and international postage solutions. In addition, the company offers customized postage solutions under the PhotoStamps and PictureItPostage brand names, which allow consumers to turn digital photos, designs, or images into USPS-approved postage; and sells NetStamps labels, shipping labels, other mailing labels, dedicated postage printers, scales, and other mailing and shipping-focused office supplies through its mailing and shipping supplies stores. It serves individuals, small businesses, home offices, medium-size businesses, large enterprises, e-commerce merchants, and warehouse shippers. The company was formerly known as StampMaster, Inc. and changed its name to Stamps.com Inc. in December 1998. Stamps.com Inc. was founded in 1996 and is headquartered in El Segundo, California.
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