Reviewing China Information Technology (CNIT) & New Relic (NEWR)

China Information Technology (NASDAQ: CNIT) and New Relic (NYSE:NEWR) are both industrial products companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, profitability, earnings, analyst recommendations, valuation, risk and dividends.

Profitability

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This table compares China Information Technology and New Relic’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
China Information Technology N/A N/A N/A
New Relic -16.17% -25.22% -13.61%

Analyst Recommendations

This is a breakdown of recent ratings and target prices for China Information Technology and New Relic, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
China Information Technology 0 0 0 0 N/A
New Relic 0 5 8 0 2.62

New Relic has a consensus price target of $65.38, suggesting a potential downside of 10.59%. Given New Relic’s higher probable upside, analysts clearly believe New Relic is more favorable than China Information Technology.

Institutional & Insider Ownership

1.6% of China Information Technology shares are held by institutional investors. Comparatively, 75.8% of New Relic shares are held by institutional investors. 45.4% of China Information Technology shares are held by insiders. Comparatively, 23.1% of New Relic shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Risk and Volatility

China Information Technology has a beta of 2.6, suggesting that its stock price is 160% more volatile than the S&P 500. Comparatively, New Relic has a beta of 0.64, suggesting that its stock price is 36% less volatile than the S&P 500.

Earnings and Valuation

This table compares China Information Technology and New Relic’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
China Information Technology $18.19 million 3.88 $850,000.00 N/A N/A
New Relic $263.48 million 15.39 -$61.07 million ($1.10) -66.48

China Information Technology has higher earnings, but lower revenue than New Relic.

Summary

China Information Technology beats New Relic on 6 of the 11 factors compared between the two stocks.

About China Information Technology

China Information Technology, Inc (CNIT) is a leading Internet service company that provides integrated cloud-based solutions enabling innovation and smart living in the fields of new media, elevator safety management, education, etc. Through continuous innovation, CNIT is aiming to leverage its proprietary Cloud-Application-Terminal technology to level the competitive landscape in the new media industry and deliver value for its shareholders, employees, customers, and the community.

About New Relic

New Relic, Inc., a software-as-a-service company, provides digital intelligence products worldwide. The company's cloud-based platform and suite of products include New Relic Digital Intelligence Platform, which enables organizations to collect, store, and analyze data. It provides New Relic Application Performance Management that offers visibility into the performance and usage of server-based applications, such as data pertaining to response time, transaction throughput, error rates, transactions, and user satisfaction; New Relic Mobile, which provides code-level visibility into the performance of mobile applications running on the iOS and Android mobile operating systems; and New Relic Browser, a product that monitors the page view experiences of actual end-users for desktop and mobile browser-based applications. The company also offers New Relic Synthetics, which simulates usage and reproduces business-critical functionality that enables its users to test their software throughout the development life cycle; and New Relic Infrastructure that provides information technology operation teams with the visibility into the health performance of their infrastructure. In addition, it provides New Relic Insights that enables technology and business users to perform real-time analysis; New Relic Alerts, a centralized notification system for managing alert policies and alert conditions; New Relic Plugins, which offers a plugin architecture, including application programming interfaces and software development kits for customers and partners to embed and extend its solution into their products; and real-time dashboards for tracking business metrics from a set of application sources, as well as live-state server configuration monitoring across cloud infrastructure. The company sells its products through direct sales organizations, online and offline sales, and marketing activities. New Relic, Inc. was founded in 2007 and is headquartered in San Francisco, California.

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