DXC Technology (NYSE:DXC) vs. Information Services Group (NASDAQ:III) Critical Survey

DXC Technology (NYSE:DXC) and Information Services Group (NASDAQ:III) are both small-cap technology companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, risk, analyst recommendations, valuation, institutional ownership, profitability and earnings.

Analyst Recommendations

This is a breakdown of recent ratings for DXC Technology and Information Services Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DXC Technology	2	7	0	0	1.78
Information Services Group	0	1	1	0	2.50

DXC Technology presently has a consensus price target of $12.21, suggesting a potential upside of 8.91%. Information Services Group has a consensus price target of $5.50, suggesting a potential upside of 8.06%. Given DXC Technology’s higher probable upside, research analysts clearly believe DXC Technology is more favorable than Information Services Group.

Volatility and Risk

DXC Technology has a beta of 0.8, meaning that its stock price is 20% less volatile than the S&P 500. Comparatively, Information Services Group has a beta of 1.1, meaning that its stock price is 10% more volatile than the S&P 500.

Institutional & Insider Ownership

96.2% of DXC Technology shares are owned by institutional investors. Comparatively, 73.1% of Information Services Group shares are owned by institutional investors. 1.1% of DXC Technology shares are owned by insiders. Comparatively, 15.8% of Information Services Group shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares DXC Technology and Information Services Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
DXC Technology	0.99%	15.60%	3.94%
Information Services Group	4.67%	13.59%	6.20%

Valuation and Earnings

This table compares DXC Technology and Information Services Group”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DXC Technology	$12.64 billion	0.14	$18.00 million	$0.70	16.02
Information Services Group	$244.73 million	1.01	$9.34 million	$0.23	22.13

DXC Technology has higher revenue and earnings than Information Services Group. DXC Technology is trading at a lower price-to-earnings ratio than Information Services Group, indicating that it is currently the more affordable of the two stocks.

Summary

Information Services Group beats DXC Technology on 8 of the 14 factors compared between the two stocks.

About DXC Technology

DXC Technology Company, together with its subsidiaries, provides information technology services and solutions in the United States, the United Kingdom, rest of Europe, Australia, and internationally. It operates in two segments, Global Business Services (GBS) and Global Infrastructure Services (GIS). The GBS segment offers a portfolio of analytics services and extensive partner ecosystem that help its customers to gain insights, automate operations, and accelerate their transformation journeys; and software engineering, consulting, and data analytics solutions, which enable businesses to run and manage their mission-critical functions, transform their operations, and develop new ways of doing business. This segment also simplifies, modernize, and accelerate mission-critical applications that support business agility and growth through applications services; provides proprietary modular insurance software and platforms; and operates a wide spectrum of insurance business process services, as well as helps to operate and improve bank cards, payment and lending process and operations, and customer experiences. The GIS segment offers security services, such as IT security, operations and culture for migrating to the cloud, protecting data with a zero-trust strategy, and manage a security operation center; and cloud infrastructure and IT outsourcing services. This segment also delivers a consumer-like experience, centralize IT management, and support services, as well as improves the total cost of ownership; and orchestrates hybrid cloud and multicloud environments. The company markets and sells its products through direct sales force to commercial businesses and public sector enterprises. DXC Technology Company was founded in 1959 and is headquartered in Ashburn, Virginia.

About Information Services Group

Information Services Group, Inc., together with its subsidiaries, operates as a technology research and advisory company in the Americas, Europe, and the Asia Pacific. The company offers digital transformation services, including automation, cloud, and data analytics; sourcing advisory; managed governance and risk; network carrier; technology strategy and operations design; change management; and market intelligence and technology research and analysis services. It supports private and public sector organizations to transform and optimize their operational environments. The company also provides ISG Digital, a client solution platform that helps clients developing technology, transformation, sourcing, and digital solutions; and ISG Enterprise, a client solution platform that helps clients manage change and optimize operations in areas comprising finance, human resource, and Procure2Pay. In addition, it offers ISG GovernX to automate the management of third-party supplier relationships that comprise contract and project lifecycles, and risk management; ISG Generative AI; ISG Network Select to streamline and simplify how enterprises build their network solutions; HR technology and transformations; providers-as-a-business services; ISG Digital Engineering; ISG Research; and training-as-a-service. The company serves private sector clients operating in the manufacturing, banking and financial services, insurance, health sciences, energy and utilities, and consumer services industries; and public sector clients, including state and local governments, airport and transit authorities, and national and provincial government units. Information Services Group, Inc. was founded in 2006 and is based in Stamford, Connecticut.