Comparing Edenred (OTCMKTS:EDNMY) and Acuity (NYSE:AYI)

Acuity (NYSE:AYI) and Edenred (OTCMKTS:EDNMY) are both mid-cap business services companies, but which is the better business? We will contrast the two businesses based on the strength of their dividends, earnings, institutional ownership, analyst recommendations, valuation, profitability and risk.

Profitability

This table compares Acuity and Edenred’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Acuity	9.04%	20.97%	11.95%
Edenred	N/A	N/A	N/A

Institutional & Insider Ownership

98.2% of Acuity shares are held by institutional investors. 2.9% of Acuity shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Volatility and Risk

Acuity has a beta of 1.5, suggesting that its share price is 50% more volatile than the S&P 500. Comparatively, Edenred has a beta of 0.52, suggesting that its share price is 48% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Acuity and Edenred, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Acuity	0	4	5	0	2.56
Edenred	0	4	1	0	2.20

Acuity currently has a consensus price target of $389.33, indicating a potential upside of 50.91%. Given Acuity’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Acuity is more favorable than Edenred.

Dividends

Acuity pays an annual dividend of $0.80 per share and has a dividend yield of 0.3%. Edenred pays an annual dividend of $0.46 per share and has a dividend yield of 4.3%. Acuity pays out 6.2% of its earnings in the form of a dividend. Acuity has increased its dividend for 3 consecutive years.

Valuation and Earnings

This table compares Acuity and Edenred”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Acuity	$4.35 billion	1.82	$396.60 million	$13.00	19.85
Edenred	$3.35 billion	1.52	$589.32 million	N/A	N/A

Edenred has lower revenue, but higher earnings than Acuity.

Summary

Acuity beats Edenred on 12 of the 15 factors compared between the two stocks.

About Acuity

Acuity Brands, Inc. provides lighting, lighting controls, building management system, location-aware applications in the United States and internationally. The company operates in two segments, Acuity Brands Lighting and Lighting Controls (ABL); and the Intelligent Spaces Group (ISG). The ABL segment provides commercial, architectural, and specialty lighting solutions, as well as lighting controls and components for various indoor and outdoor applications under the A-Light, Aculux, American Electric Lighting, Cyclone, Dark to Light, eldoLED, Eureka, Gotham, Healthcare Lighting, Holophane, Hydrel, Indy, IOTA, Juno, Lithonia Lighting, Luminaire LED, Luminis, Mark Architectural Lighting, nLight, OPTOTRONIC, Peerless, RELOCWiring Solutions, and Sensor Switch. This segment serves electrical distributors, retail home improvement centers, electric utilities, national accounts, original equipment manufacturers, digital retailers, lighting showrooms, and energy service companies. The ISG segment offers building management solutions, such as products for controlling heating, ventilation, air conditioning, lighting, shades, refrigeration, and building access that deliver end-to-end optimization of those building systems; and building management software that enhances building system management and automates labor intensive tasks. This segment serves system integrators, as well as retail stores, airports, and enterprise campuses. The company offers its products and solutions under the Atrius, Distech Controls, and KE2 Therm Solutions brands. Acuity Brands, Inc. was incorporated in 2001 and is headquartered in Atlanta, Georgia.

About Edenred

Edenred SE provides digital platform for services and payments for companies, employees, and merchants worldwide. It offers employee benefit solutions, including Ticket Restaurant, a solution that allows employees to take time out for lunch at a partner merchant; Ticket Alimentación that allows users to pay for groceries in neighborhood stores and supermarkets; Ticket Regalo, a gift voucher; Ticket CESU, a human services solution; Ticket Plus Card, a solution that enables the purchase of staples, such as food and fuel; Ticket Welfare, which employees can use to pay for a range of services, such as access to sports facilities and solutions for their children’s educational needs; Ticket Guardería for companies without on-site daycare facilities; Childcare Vouchers; Ticket EcoCheque, a solutions that encourages purchase of environmentally friendly products; Ticket Kadeos Culture and Ticket Cultura that are solutions for cultural goods and services. The company also offers mobility solutions comprising Ticket Log for light vehicle fleet management; Ticket Fleet Pro and Ticket Cargo for truck fleet management; Ticket Car for employees to pay for fuel and other business travel expenses; UTA Edenred for paying tolls, optimize routes, pay for roadside assistance and truck servicing, and for VAT reimbursement; fuel cards; and refund services for VAT and excise duties. In addition, it provides complementary solutions comprising corporate payment, invoice processing automation, and salary card solutions. Edenred SE was founded in 1962 and is headquartered in Issy-les-Moulineaux, France.