Comparing C3.ai (NYSE:AI) & Wipro (NYSE:WIT)

Wipro (NYSE:WIT) and C3.ai (NYSE:AI) are both computer and technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their valuation, earnings, profitability, dividends, risk, analyst recommendations and institutional ownership.

Dividends

Wipro pays an annual dividend of $0.11 per share and has a dividend yield of 6.1%. C3.ai pays an annual dividend of $0.90 per share and has a dividend yield of 10.4%. Wipro pays out 78.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. C3.ai pays out -28.6% of its earnings in the form of a dividend. C3.ai is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk & Volatility

Wipro has a beta of 0.92, indicating that its stock price is 8% less volatile than the S&P 500. Comparatively, C3.ai has a beta of 2, indicating that its stock price is 100% more volatile than the S&P 500.

Earnings & Valuation

This table compares Wipro and C3.ai”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Wipro	$926.24 billion	0.02	$1.41 billion	$0.14	12.96
C3.ai	$307.39 million	4.10	-$288.70 million	($3.15)	-2.75

Wipro has higher revenue and earnings than C3.ai. C3.ai is trading at a lower price-to-earnings ratio than Wipro, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current recommendations and price targets for Wipro and C3.ai, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Wipro	1	2	0	0	1.67
C3.ai	6	7	1	1	1.80

C3.ai has a consensus target price of $15.93, suggesting a potential upside of 83.88%. Given C3.ai’s stronger consensus rating and higher possible upside, analysts plainly believe C3.ai is more favorable than Wipro.

Profitability

This table compares Wipro and C3.ai’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Wipro	14.25%	14.97%	9.68%
C3.ai	-141.35%	-55.40%	-45.00%

Institutional & Insider Ownership

2.4% of Wipro shares are held by institutional investors. Comparatively, 39.0% of C3.ai shares are held by institutional investors. 1.0% of Wipro shares are held by company insiders. Comparatively, 26.5% of C3.ai shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Summary

C3.ai beats Wipro on 10 of the 17 factors compared between the two stocks.

About Wipro

Wipro Limited operates as an information technology (IT), consulting, and business process services company worldwide. It operates through IT Services and IT Products segments. The IT Services segment offers IT and IT-enabled services, including digital strategy advisory, customer-centric design, technology and IT consulting, custom application design, development, re-engineering and maintenance, systems integration, package implementation, cloud and infrastructure, business process, cloud, mobility and analytics, research and development, and hardware and software design services to enterprises. It serves customers in various industry sectors, such as communications, retail connectivity and services, consumer goods, healthcare, technology products and platforms, banking and financial services, energy, manufacturing and resources, capital markets and insurance, and hi-tech. The IT Products segment provides a range of third-party IT products comprising enterprise platforms, networking solutions, software and data storage products, contact center infrastructure, enterprise security, IT optimization technologies, video solutions, and end-user computing solutions. It serves enterprises in various industries primarily in the Indian market, which comprise the government, defense, IT and IT-enabled services, telecommunications, manufacturing, utilities, education, and financial services sectors. The company was incorporated in 1945 and is based in Bengaluru, India.

About C3.ai

C3.ai, Inc. operates as an enterprise artificial intelligence (AI) software company in North America, Europe, the Middle East, Africa, the Asia Pacific, and internationally. The company provides C3 AI platform, an application development and runtime environment that enables customers to design, develop, and deploy enterprise AI applications; C3 AI Ex Machina for analysis-ready data; C3 AI CRM, an industry specific customer relationship management solution; and C3 Generative AI Product Suite that enables to locate, retrieve, and present information. It also offers C3 AI applications, including C3 AI Inventory Optimization, a solution to optimize raw material, in-process, and finished goods inventory levels; C3 AI Supply Network Risk, which identifies emerging inbound and outbound risks across the network; C3 AI Sustainability Suite, which helps to decrease greenhouse gas emission; C3 AI Production Schedule Optimization, a solution for scheduling production; C3 AI Financial Services Suite, which helps to minimize compliance risks; and C3 AI Energy Management solution. In addition, it offers integrated turnkey enterprise AI applications for oil and gas, chemicals, utilities, manufacturing, financial services, defense, intelligence, aerospace, healthcare, and telecommunications market. It has strategic partnerships with Baker Hughes in the areas of oil and gas market; Booz Allen to provide solutions to government, defense, and intelligence sectors; Raytheon; and AWS, Google, and Microsoft. The company was formerly known as C3 IoT, Inc. and changed its name to C3.ai, Inc. in June 2019. C3.ai, Inc. was incorporated in 2009 and is headquartered in Redwood City, California.