Grid Dynamics (NASDAQ:GDYN) vs. Telos (NASDAQ:TLS) Critical Survey

Grid Dynamics (NASDAQ:GDYN) and Telos (NASDAQ:TLS) are both small-cap computer and technology companies, but which is the better business? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, earnings, dividends, risk, valuation and profitability.

Valuation and Earnings

This table compares Grid Dynamics and Telos”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Grid Dynamics	$411.83 million	1.25	$9.67 million	$0.10	60.20
Telos	$164.80 million	1.95	-$52.52 million	($0.50)	-8.66

Grid Dynamics has higher revenue and earnings than Telos. Telos is trading at a lower price-to-earnings ratio than Grid Dynamics, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Grid Dynamics and Telos’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Grid Dynamics	2.35%	1.46%	1.28%
Telos	-22.17%	-20.30%	-14.89%

Analyst Recommendations

This is a summary of recent recommendations and price targets for Grid Dynamics and Telos, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Grid Dynamics	1	1	5	0	2.57
Telos	1	2	2	0	2.20

Grid Dynamics currently has a consensus price target of $10.60, suggesting a potential upside of 76.08%. Telos has a consensus price target of $7.38, suggesting a potential upside of 70.32%. Given Grid Dynamics’ stronger consensus rating and higher probable upside, equities research analysts plainly believe Grid Dynamics is more favorable than Telos.

Insider and Institutional Ownership

71.2% of Grid Dynamics shares are owned by institutional investors. Comparatively, 62.1% of Telos shares are owned by institutional investors. 6.5% of Grid Dynamics shares are owned by company insiders. Comparatively, 14.9% of Telos shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Volatility & Risk

Grid Dynamics has a beta of 0.84, indicating that its share price is 16% less volatile than the S&P 500. Comparatively, Telos has a beta of 1.03, indicating that its share price is 3% more volatile than the S&P 500.

Summary

Grid Dynamics beats Telos on 11 of the 14 factors compared between the two stocks.

About Grid Dynamics

Grid Dynamics Holdings, Inc., together with its subsidiaries, provides technology consulting, platform and product engineering, and analytics services in North America, Europe, and internationally. It offers cloud platform and product engineering services, such as architecting, designing, and building scalable and secure cloud-based platforms and business applications; and AI/machine learning and data platform engineering services that build platforms to facilitate batch and streaming data ingestion, quality governance, orchestration, semantic modeling, observability, and analysis at scale. The company provides digital engagement services, including digital ecosystem design and implementation; and supply chain, Internet of Thing, and advanced manufacturing, which focuses on transforming traditional operations into smart and connected ecosystems. It serves customers that operate in the tech, media, telecommunications, retail, consumer packaged goods, manufacturing, and finance industries. The company was formerly known as ChaSerg Technology Acquisition Corp. and changed its name to Grid Dynamics Holdings, Inc. Grid Dynamics Holdings, Inc. was founded in 2006 and is headquartered in San Ramon, California.

About Telos

Telos Corporation, together with its subsidiaries, provides cyber, cloud, and enterprise security solutions worldwide. The company operates in two segments, Security Solutions and Secure Networks. It provides Xacta, a platform for enterprise cyber risk management and security compliance automation; and consulting, assessment and compliance, engineering and evaluation, operations, and penetration testing services. The company also offers Telos Automated Message Handling System, a web-based organizational message distribution and management for mission-critical communications used by military field operatives; and Telos Advanced Cyber Analytics solution, which is a threat feed source of global Internet Protocol addresses known to engage in potentially malicious activity, including mass scanning and generic opportunistic attacks; and Telos Ghost, a solution to eliminate cyberattack surfaces by obfuscating and encrypting data, masking user identity and location, and hiding network resources, as well as provides security and privacy for intelligence gathering, cyber threat protection, securing critical infrastructure, and protecting communications and applications. In addition, the company provides IDTrust360, an enterprise digital trusted identity risk platform for extending flexible hybrid cloud identity services; and ONYX, a touchless fingerprint biometric solution for mobile devices. Further, it offers secure mobility solutions that enable remote work and minimize operational and security concerns across and beyond the enterprise; and network management and defense services for operating, administrating, and defending complex enterprise networks and services for defensive cyber operations. It serves the United States federal government, large commercial businesses, state and local governments, and international customers. Telos Corporation was founded in 1968 and is headquartered in Ashburn, Virginia.