Head-To-Head Contrast: Science Applications International (NASDAQ:SAIC) versus Wipro (NYSE:WIT)

Wipro (NYSE:WIT) and Science Applications International (NASDAQ:SAIC) are both computer and technology companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, risk, analyst recommendations, earnings, valuation, dividends and institutional ownership.

Insider and Institutional Ownership

2.4% of Wipro shares are held by institutional investors. Comparatively, 76.0% of Science Applications International shares are held by institutional investors. 1.0% of Wipro shares are held by insiders. Comparatively, 0.4% of Science Applications International shares are held by 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.

Analyst Recommendations

This is a summary of current ratings and target prices for Wipro and Science Applications International, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Wipro	1	4	0	0	1.80
Science Applications International	0	1	0	1	3.00

Volatility and Risk

Wipro has a beta of 1.05, suggesting that its stock price is 5% more volatile than the S&P 500. Comparatively, Science Applications International has a beta of 0.3, suggesting that its stock price is 70% less volatile than the S&P 500.

Dividends

Wipro pays an annual dividend of $0.10 per share and has a dividend yield of 3.3%. Science Applications International pays an annual dividend of $1.48 per share and has a dividend yield of 1.5%. Wipro pays out 66.7% of its earnings in the form of a dividend. Science Applications International pays out 18.9% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Profitability

This table compares Wipro and Science Applications International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Wipro	15.06%	15.80%	10.38%
Science Applications International	5.05%	33.19%	9.62%

Valuation & Earnings

This table compares Wipro and Science Applications International”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Wipro	$10.43 billion	3.08	$1.54 billion	$0.15	20.43
Science Applications International	$7.35 billion	0.63	$362.00 million	$7.82	13.04

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

Summary

Wipro beats Science Applications International on 9 of the 15 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 Science Applications International

Science Applications International Corporation provides technical, engineering, and enterprise information technology (IT) services primarily in the United States. The company’s offerings include engineering; technology integration; IT modernization; maintenance of ground and maritime systems; logistics; training and simulation; operation and program support services; and end-to-end services, such as design, development, integration, deployment, management and operations, sustainment, and security of its customers’ IT infrastructure, as well as cloud migration, managed services, infrastructure modernization, and enterprise IT-as-a-service solutions. It serves the U.S. military comprising Army, Air Force, Navy, Marines, and Coast Guard; Department of Defense agencies; National Aeronautics and Space Administration; the U.S. Department of State; Department of Justice; Department of Homeland Security; and various intelligence community agencies, as well as U.S. federal civilian agencies. The company was formerly known as SAIC Gemini, Inc. and changed its name to Science Applications International Corporation in September 2013. Science Applications International Corporation was founded in 1969 and is headquartered in Reston, Virginia.