NTT DATA CORP/ADR (NTDTY) versus Formula Systems (1985) (FORTY) Critical Survey

NTT DATA CORP/ADR (OTCMKTS:NTDTY) and Formula Systems (1985) (NASDAQ:FORTY) are both business services companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, risk, analyst recommendations, profitability, valuation, dividends and institutional ownership.

Profitability

This table compares NTT DATA CORP/ADR and Formula Systems (1985)’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
NTT DATA CORP/ADR 3.41% 10.04% 3.96%
Formula Systems (1985) 1.83% 3.42% 1.68%

Earnings and Valuation

This table compares NTT DATA CORP/ADR and Formula Systems (1985)’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
NTT DATA CORP/ADR $19.12 billion 0.85 $523.55 million $0.51 22.75
Formula Systems (1985) $1.36 billion 0.43 $10.35 million N/A N/A

NTT DATA CORP/ADR has higher revenue and earnings than Formula Systems (1985).

Dividends

NTT DATA CORP/ADR pays an annual dividend of $0.11 per share and has a dividend yield of 0.9%. Formula Systems (1985) pays an annual dividend of $0.47 per share and has a dividend yield of 1.2%. NTT DATA CORP/ADR pays out 21.6% of its earnings in the form of a dividend.

Risk & Volatility

NTT DATA CORP/ADR has a beta of 1.89, meaning that its stock price is 89% more volatile than the S&P 500. Comparatively, Formula Systems (1985) has a beta of 0.8, meaning that its stock price is 20% less volatile than the S&P 500.

Institutional & Insider Ownership

0.1% of Formula Systems (1985) shares are owned by institutional investors. 23.3% of Formula Systems (1985) shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of recent ratings for NTT DATA CORP/ADR and Formula Systems (1985), as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
NTT DATA CORP/ADR 0 0 0 0 N/A
Formula Systems (1985) 0 0 0 0 N/A

Summary

NTT DATA CORP/ADR beats Formula Systems (1985) on 8 of the 12 factors compared between the two stocks.

About NTT DATA CORP/ADR

NTT DATA Corporation provides consulting, system development, and business information technology (IT) outsourcing services worldwide. It operates through Public & Social Infrastructure, Financial, Enterprise & Solutions, North America, and EME and LATAM segments. The company offers value-added IT services for government, medical, telecommunications, electric power, and other social infrastructure; financial institutions; and the manufacturing, distribution, and servicing industries, as well as payment services and platform solutions. The company was formerly known as NTT Data Communications Systems Corporation and changed its name to NTT DATA Corporation in 1996. The company was founded in 1967 and is headquartered in Tokyo, Japan. NTT DATA Corporation is a subsidiary of Nippon Telegraph and Telephone Corporation.

About Formula Systems (1985)

Formula Systems (1985) Ltd., through its subsidiaries, provides software, proprietary and non-proprietary software, and software product marketing and support services. The company offers computer and telecommunication infrastructure solutions; computer solutions to computer and communications infrastructures; cloud computing solutions; database and big data services; customer relations management, computer systems management infrastructures, Web world content management, database and data warehouse mining, application integration, database and systems, data management, and software development tools; and professional training courses and advanced professional studies. It also markets and sells computers and peripheral equipment to business customers. In addition, the company offers life, pension, and annuities platforms/solutions, including Sapiens ALIS, LifeSuite, Life Portraits, LifeApply, Sapiens INSIGHT, and Sapiens Closed Books; property and casualty/general insurance platforms/solutions, such as Sapiens IDIT, Adaptik Policy, Adaptik Billing, Stream Claim, Sapiens Stingray, PowerSuite, and CompSuite; and reinsurance software solutions comprising Sapiens Reinsurance, Freedom Reinsurance System, and Universal Reinsurance System. Further, it provides financial and compliance solutions that include eFreedom Annual Statement, PRO Financial General Ledger and Accounts Payable, Preferred Tax Enterprise Financial applications, Insurance Financial reporting, and Power2Play; Sapiens DECISION, a decision management platform; and technology-based solutions and digital insurance suites. Additionally, the company offers application development and business process integration platforms; vertical software solutions; vendor of software services and IT outsourcing software services; and professionals in various areas, as well as develops on-premise payroll software solutions. The company was founded in 1985 and is headquartered in Or Yehuda, Israel.

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