Liberty Tax Service (NASDAQ: TAX) and Joint (NASDAQ:JYNT) are both small-cap business services companies, but which is the superior stock? We will contrast the two businesses based on the strength of their valuation, risk, profitability, institutional ownership, dividends, earnings and analyst recommendations.
Volatility & Risk
Liberty Tax Service has a beta of 0.72, meaning that its stock price is 28% less volatile than the S&P 500. Comparatively, Joint has a beta of 0.98, meaning that its stock price is 2% less volatile than the S&P 500.
This is a summary of current ratings for Liberty Tax Service and Joint, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Liberty Tax Service||0||1||0||0||2.00|
Joint has a consensus target price of $6.15, indicating a potential downside of 9.16%. Given Joint’s stronger consensus rating and higher probable upside, analysts clearly believe Joint is more favorable than Liberty Tax Service.
Insider and Institutional Ownership
48.0% of Liberty Tax Service shares are owned by institutional investors. Comparatively, 49.6% of Joint shares are owned by institutional investors. 40.4% of Liberty Tax Service shares are owned by insiders. Comparatively, 6.1% of Joint shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
Liberty Tax Service pays an annual dividend of $0.64 per share and has a dividend yield of 6.3%. Joint does not pay a dividend. Liberty Tax Service pays out 55.7% of its earnings in the form of a dividend.
This table compares Liberty Tax Service and Joint’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Liberty Tax Service||7.25%||14.97%||6.66%|
Valuation and Earnings
This table compares Liberty Tax Service and Joint’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Liberty Tax Service||$173.99 million||0.74||$13.01 million||$1.15||8.87|
|Joint||$25.16 million||3.66||-$3.27 million||($0.25)||-27.08|
Liberty Tax Service has higher revenue and earnings than Joint. Joint is trading at a lower price-to-earnings ratio than Liberty Tax Service, indicating that it is currently the more affordable of the two stocks.
Liberty Tax Service beats Joint on 9 of the 16 factors compared between the two stocks.
Liberty Tax Service Company Profile
Liberty Tax, Inc., together with its subsidiaries, provides tax preparation services and solutions in the United States and Canada. The company also facilitates refund-based tax settlement financial products, such as refund transfer products, refund-based loans, and personal income tax refund discounting, as well as provides an online digital Do-It-Yourself tax program in the United States. Its customers include taxpayers who, for reasons of complexity, convenience, or the need for prompt tax refunds, seek assisted tax preparation services. Liberty Tax, Inc. offers its products and services through a network of company-owned offices and franchised locations under the Liberty Tax, Liberty Tax Service, Liberty Income Tax, Liberty Canada, and SiempreTax+ brand names. The company was formerly known as JTH Holding, Inc. and changed its name to Liberty Tax, Inc. in July 2014. Liberty Tax, Inc. was founded in 1996 and is headquartered in Virginia Beach, Virginia.
Joint Company Profile
The Joint Corp. develops, owns, operates, supports and manages chiropractic clinics through direct ownership, management arrangements, franchising and the sale of regional developer rights throughout the United States. The Company is franchisor and operator of chiropractic clinics. The Company offers its patients the opportunity to visit its clinics without an appointment and receive prompt attention. The Company has approximately 310 franchised, company-owned, or managed clinics in operation in over 30 states. In addition to its approximately 310 operating clinics, the Company has granted franchises either directly or through its regional developers for an additional over 170 clinics. The Company offers a range of membership and wellness packages. Each patient’s records are digitally updated for ready retrieval in its data storage system by its chiropractors in compliance with various applicable medical records security and privacy regulations.
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