Virtusa (NASDAQ:VRTU) versus Perficient (PRFT) Financial Contrast

Virtusa (NASDAQ:VRTU) and Perficient (NASDAQ:PRFT) are both small-cap computer and technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, earnings, profitability, dividends, risk and institutional ownership.

Earnings and Valuation

This table compares Virtusa and Perficient’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Virtusa $1.02 billion 1.62 $1.25 million $0.89 62.20
Perficient $498.38 million 1.87 $24.56 million $1.21 23.18

Perficient has lower revenue, but higher earnings than Virtusa. Perficient is trading at a lower price-to-earnings ratio than Virtusa, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Virtusa has a beta of 1.05, indicating that its share price is 5% more volatile than the S&P 500. Comparatively, Perficient has a beta of 0.94, indicating that its share price is 6% less volatile than the S&P 500.

Profitability

This table compares Virtusa and Perficient’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Virtusa 0.89% 11.39% 4.13%
Perficient 4.93% 11.23% 7.72%

Institutional and Insider Ownership

88.6% of Virtusa shares are owned by institutional investors. Comparatively, 92.1% of Perficient shares are owned by institutional investors. 5.1% of Virtusa shares are owned by insiders. Comparatively, 3.5% of Perficient shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Virtusa and Perficient, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Virtusa 0 1 4 1 3.00
Perficient 0 0 5 0 3.00

Virtusa currently has a consensus price target of $63.20, suggesting a potential upside of 14.16%. Perficient has a consensus price target of $32.00, suggesting a potential upside of 14.08%. Given Virtusa’s higher probable upside, research analysts plainly believe Virtusa is more favorable than Perficient.

About Virtusa

Virtusa Corporation provides digital engineering and information technology (IT) outsourcing services worldwide. The company offers business and IT consulting services, including advisory/target operating model, business process re-engineering/business management, transformational solution consulting, and business/technology alignment analysis; omni-channel digital strategy, experience design accelerated solution design, and employee engagement; and application portfolio rationalization, SDLC transformation, and BA competency transformation services. It also provides application development, software product engineering, CRM and SAP implementation, content management, enterprise mobility, cloud computing, and social media solutions; systems consolidation and rationalization, technology migration and porting, and legacy application Web-enablement; data management, business intelligence, reporting and decision support, master data management, data integration, and big data analytics; and software quality assurance and managed testing services. In addition, the company offers application maintenance and support, applications enhancement, and cloud-environment management and support; managed infrastructure, and remote application monitoring and support services; and IT efficiency improvement services. Further, it offers digital engineering and operational excellence services-based, and transformational solutions. The company serves communications and technology; banking, financial services, and insurance; and media and information industries. The company has collaboration agreements with Moxtra, Inc. to develop and deploy solutions for financial services firms, as well as the Banking Industry Architecture Network; and Indiana Biosciences Research Institute. The company was formerly known as eRunway, Inc. and changed its name to Virtusa Corporation in April 2002. Virtusa Corporation was founded in 1996 and is headquartered in Southborough, Massachusetts.

About Perficient

Perficient, Inc. provides information technology and management consulting services in the United States. The company designs, builds, and delivers solutions using middleware software products developed by third-party vendors. Its solutions include portals and collaboration, such as searchable data systems, collaborative systems for process improvement, transaction processing, unified and extended reporting, commerce, content management, and other services; and platform implementations services, including application server selection, architecture planning, installation and configuration, clustering for availability, performance assessment and issue remediation, security, and technology migrations. The company also offers management consulting services in the areas of organizational change management, business analytics, project management, process excellence, and other; and cloud services comprising architecture, business value and health checks assessments, strategy and road maps, and vendor evaluation and selection services. In addition, it provides digital marketing services, including search engine marketing, user experience and design, and conversion rate optimization; commerce solutions; and content management solutions. Further, the company offers business analytics; custom applications; business integration; business process management; customer relationship management; enterprise data and business intelligence; enterprise performance management; DevOps; and enterprise mobile solutions. It serves the healthcare, financial services, automotive and transportation, retail and consumer goods, manufacturing, electronics and computer hardware, telecommunications, business services and leisure, media and entertainment, and energy and utilities markets. Perficient, Inc. was founded in 1997 and is headquartered in St. Louis, Missouri.

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