SAP (NYSE:SAP) versus SS&C Technologies (NASDAQ:SSNC) Financial Survey

SS&C Technologies (NASDAQ:SSNC) and SAP (NYSE:SAP) are both large-cap computer and technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, risk, profitability, institutional ownership, earnings and dividends.

Institutional & Insider Ownership

96.9% of SS&C Technologies shares are held by institutional investors. 16.4% of SS&C Technologies shares are held by company insiders. Comparatively, 7.4% of SAP shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares SS&C Technologies and SAP’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SS&C Technologies	12.70%	19.60%	6.85%
SAP	19.92%	16.54%	10.28%

Valuation and Earnings

This table compares SS&C Technologies and SAP”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SS&C Technologies	$6.27 billion	2.63	$796.90 million	$3.16	21.62
SAP	$41.63 billion	5.07	$8.10 billion	$7.05	24.38

SAP has higher revenue and earnings than SS&C Technologies. SS&C Technologies is trading at a lower price-to-earnings ratio than SAP, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

SS&C Technologies has a beta of 1.19, meaning that its stock price is 19% more volatile than the S&P 500. Comparatively, SAP has a beta of 1.24, meaning that its stock price is 24% more volatile than the S&P 500.

Dividends

SS&C Technologies pays an annual dividend of $1.08 per share and has a dividend yield of 1.6%. SAP pays an annual dividend of $1.84 per share and has a dividend yield of 1.1%. SS&C Technologies pays out 34.2% of its earnings in the form of a dividend. SAP pays out 26.1% 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. SS&C Technologies has raised its dividend for 9 consecutive years. SS&C Technologies is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a summary of recent recommendations for SS&C Technologies and SAP, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SS&C Technologies	0	2	6	1	2.89
SAP	0	8	11	2	2.71

SS&C Technologies currently has a consensus price target of $101.00, indicating a potential upside of 47.81%. SAP has a consensus price target of $305.75, indicating a potential upside of 77.86%. Given SAP’s higher probable upside, analysts clearly believe SAP is more favorable than SS&C Technologies.

Summary

SAP beats SS&C Technologies on 12 of the 18 factors compared between the two stocks.

About SS&C Technologies

SS&C Technologies Holdings, Inc. engages in the development and provision of software solutions to the financial services and healthcare industries. It operates through the following geographical segments: United States, Europe, Middle East and Africa, Asia Pacific and Japan, Canada, and the Americas, excluding the United States and Canada. Its products include advent genesis, antares, asset allocators, AWD, axys, BANC mall, BRIX, DST vision, evare, lightning, and moxy. The company was founded by William Charles Stone in March 1986 and is headquartered in Windsor, CT.

About SAP

SAP SE, together with its subsidiaries, provides applications, technology, and services worldwide. It offers SAP S/4HANA that provides software capabilities for finance, risk and project management, procurement, manufacturing, supply chain and asset management, and research and development; SAP SuccessFactors solutions for human resources, including HR and payroll, talent and employee experience management, and people and workforce analytics; and spend management solutions that covers direct and indirect spend, travel and expense, and external workforce management. The company also provides SAP customer experience solutions; SAP Business Technology platform that enables customers and partners to build, integrate, and automate applications; and SAP Business Network, a business-to-business collaboration platform that helps digitalize key business processes across the supply chain and enables communication between trading partners. In addition, it offers SAP Signavio to help customers to discover, analyze, and understand their business process operations; SAP's industry cloud solutions that provides modular solutions addressing industry-specific functions; Taulia solutions for working capital management to help enable customers mitigate the effects of inflation by providing visibility into working capital and access to liquidity; and sustainability solutions and services. SAP SE was founded in 1972 and is headquartered in Walldorf, Germany.