Head to Head Contrast: MicroStrategy (MSTR) & ACI Worldwide (ACIW)

MicroStrategy (NASDAQ:MSTR) and ACI Worldwide (NASDAQ:ACIW) are both computer and technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, risk, valuation, dividends, institutional ownership, profitability and analyst recommendations.

Valuation and Earnings

This table compares MicroStrategy and ACI Worldwide’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
MicroStrategy $504.54 million 2.90 $17.64 million $5.34 23.89
ACI Worldwide $1.02 billion 3.08 $5.13 million $1.02 26.63

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

Analyst Recommendations

This is a summary of recent ratings and target prices for MicroStrategy and ACI Worldwide, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
MicroStrategy 0 0 1 0 3.00
ACI Worldwide 0 1 0 0 2.00

MicroStrategy presently has a consensus price target of $200.00, indicating a potential upside of 56.76%. ACI Worldwide has a consensus price target of $27.00, indicating a potential downside of 0.59%. Given MicroStrategy’s stronger consensus rating and higher probable upside, equities analysts plainly believe MicroStrategy is more favorable than ACI Worldwide.

Institutional & Insider Ownership

75.1% of MicroStrategy shares are owned by institutional investors. 23.2% of MicroStrategy shares are owned by insiders. Comparatively, 4.4% of ACI Worldwide shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares MicroStrategy and ACI Worldwide’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
MicroStrategy -1.39% 5.51% 3.74%
ACI Worldwide 1.42% 7.42% 3.46%

Risk & Volatility

MicroStrategy has a beta of 0.61, indicating that its share price is 39% less volatile than the S&P 500. Comparatively, ACI Worldwide has a beta of 1.28, indicating that its share price is 28% more volatile than the S&P 500.

Summary

MicroStrategy beats ACI Worldwide on 8 of the 14 factors compared between the two stocks.

MicroStrategy Company Profile

MicroStrategy Incorporated provides enterprise software platforms worldwide. It offers MicroStrategy Analytics platform that delivers reports and dashboards, and enables users to conduct ad hoc analysis and share insights through mobile devices or the Web; MicroStrategy Server, which provides analytical processing and job management for various reporting, analysis, and monitoring applications; MicroStrategy Web, a primary reporting interface for analysts that offers interactive reporting, dashboarding, and analysis through a Web browser; and MicroStrategy Desktop, an on-premise and single-user tool for easy-to-use self-service visual data discovery. The company also provides MicroStrategy Mobile, a vehicle for mobilizing an organization's information systems, including its data warehouses, business intelligence, ERP, CRM, and Web applications that are accessible on the desktop; and Usher, a digital credential and identity intelligence that enables organizations to dematerialize the traditional forms of identity verification and replace them with a single mobile identity badge. In addition, it offers MicroStrategy Cloud, an integrated and optimized cloud business analytics platform that combines infrastructure, technology, people, and processes to offer analytics as a service to customers, as well as provides technical support, consulting and advisory, and education services. It serves retail, consulting, technology, manufacturing, finance, banking, insurance, healthcare, education, telecommunication, and other industries. The company was founded in 1989 and is headquartered in Tysons Corner, Virginia.

ACI Worldwide Company Profile

ACI Worldwide, Inc. provides software products and services for facilitating electronic payments to banks, intermediaries, merchants, and corporates worldwide. It offers UP Retail Payments solution that enables banks to accept, authorize, route, and secure payment transactions; and ACI Card and Merchant Management solutions, including credit, debit, smart card, and prepaid card issuance and management, as well as merchant account management and settlement. The company also provides UP Immediate Payments solution, which provides connectivity to country-level real-time payment schemes and create various products; and UP Real-Time Payments solution that allows banks to address RTGS, SWIFT messaging, and real-time faster payments. In addition, it offers Postilion; ACI PAY.ON Payments Gateway; ACI ReD Shield, a real-time fraud prevention solution, as well as UP eCommerce Payments solution; and UP Payments Risk Management solution and ACI Universal Online Banker platform. Further, the company provides UP Bill Payment solutions, which enable customers to present bills and collect payments from consumers electronically through a single and integrated platform that controls bill payments operation. Additionally, it offers bill presentment and payment collection services to consumer finance, insurance, healthcare, higher education, tax, and utility sectors; and implementation, product support, technical, educational, facilities management, business and technical consultancy, and on-site support services, as well as distributes or acts as a sales agent for software developed by third parties. The company markets its products and services under the ACI Worldwide, ACI Universal Payments, and ACI UP brand names. It has strategic alliance with UnionPay International. The company was formerly known as Transaction Systems Architects, Inc. and changed its name to ACI Worldwide, Inc. in July 2007. ACI Worldwide, Inc. was founded in 1975 and is headquartered in Naples, Florida.

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