DLH (NASDAQ:DLHC) versus SS&C Technologies (NASDAQ:SSNC) Critical Review

SS&C Technologies (NASDAQ:SSNC) and DLH (NASDAQ:DLHC) are both industrials companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, institutional ownership, dividends, analyst recommendations, profitability, risk and earnings.

Analyst Ratings

This is a summary of recent ratings and target prices for SS&C Technologies and DLH, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SS&C Technologies	0	3	5	1	2.78
DLH	2	0	1	0	1.67

SS&C Technologies presently has a consensus target price of $91.25, suggesting a potential upside of 9.23%. Given SS&C Technologies’ stronger consensus rating and higher possible upside, research analysts clearly believe SS&C Technologies is more favorable than DLH.

Insider and Institutional Ownership

96.9% of SS&C Technologies shares are held by institutional investors. Comparatively, 67.2% of DLH shares are held by institutional investors. 16.0% of SS&C Technologies shares are held by company insiders. Comparatively, 12.8% of DLH shares are held by company 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.

Risk and Volatility

SS&C Technologies has a beta of 1.07, meaning that its stock price is 7% more volatile than the S&P 500. Comparatively, DLH has a beta of 1.47, meaning that its stock price is 47% more volatile than the S&P 500.

Profitability

This table compares SS&C Technologies and DLH’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SS&C Technologies	13.16%	21.20%	7.19%
DLH	-8.51%	-10.42%	-4.04%

Earnings and Valuation

This table compares SS&C Technologies and DLH”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SS&C Technologies	$6.27 billion	3.13	$796.90 million	$3.48	24.01
DLH	$344.50 million	0.19	$1.36 million	($1.48)	-3.02

SS&C Technologies has higher revenue and earnings than DLH. DLH is trading at a lower price-to-earnings ratio than SS&C Technologies, indicating that it is currently the more affordable of the two stocks.

Summary

SS&C Technologies beats DLH on 14 of the 15 factors compared between the two stocks.

About SS&C Technologies

SS&C Technologies Holdings, Inc. engages in the development and provision of software solutions to the financial services and healthcare industries. It operates through the following geographical segments: United States, Europe, Middle East and Africa, Asia Pacific and Japan, Canada, and the Americas, excluding the United States and Canada. Its products include advent genesis, antares, asset allocators, AWD, axys, BANC mall, BRIX, DST vision, evare, lightning, and moxy. The company was founded by William Charles Stone in March 1986 and is headquartered in Windsor, CT.

About DLH

DLH Holdings Corp. provides technology-enabled business process outsourcing, program management solutions, and public health research and analytics services in the United States. It offers digital transformation and cyber security solutions, including artificial intelligence and machine learning, cloud enablement, cybersecurity ecosystem, big data analytics, and modeling and simulation to the National Institutes of Health (NIH), the Defense Health Agency, Tele-medicine and Advanced Technology Research Center, and US Navy Naval Information Warfare Center (NIWC). The company also provides science research and development services and solutions, such as data analytics, testing and evaluation, clinical trials research services, and epidemiology studies to support multiple operating divisions, including NIH and the Center for Disease Control and Prevention, as well as the Military Health System. In addition, it offers system engineering and integration solutions in the areas of pharmaceutical delivery logistics, fire protection engineering, biomedical equipment, and technology engineering on behalf of the Department of Veterans Affairs, NIWC, Health and Human Services, and other federal customers. The company also provides business process management services under the trademarks, e-PRAT and SPOT-m, as well as the registered trademark, Infinibyte for cloud-based solutions. The company was formerly known as TeamStaff, Inc. and changed its name to DLH Holdings Corp. in June 2012. DLH Holdings Corp. was incorporated in 1969 and is headquartered in Atlanta, Georgia.