Financial Analysis: Agilysys (NASDAQ:AGYS) & Hewlett Packard Enterprise (NYSE:HPE)

Agilysys (NASDAQ:AGYS) and Hewlett Packard Enterprise (NYSE:HPE) are both computer and technology companies, but which is the better business? We will contrast the two businesses based on the strength of their dividends, risk, profitability, institutional ownership, valuation, earnings and analyst recommendations.

Profitability

This table compares Agilysys and Hewlett Packard Enterprise’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Agilysys	4.85%	11.13%	6.79%
Hewlett Packard Enterprise	3.77%	9.01%	3.10%

Valuation & Earnings

This table compares Agilysys and Hewlett Packard Enterprise”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Agilysys	$288.79 million	10.76	$23.23 million	$0.50	221.56
Hewlett Packard Enterprise	$30.13 billion	1.00	$2.58 billion	$0.82	27.87

Hewlett Packard Enterprise has higher revenue and earnings than Agilysys. Hewlett Packard Enterprise is trading at a lower price-to-earnings ratio than Agilysys, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

88.0% of Agilysys shares are held by institutional investors. Comparatively, 80.8% of Hewlett Packard Enterprise shares are held by institutional investors. 8.6% of Agilysys shares are held by insiders. Comparatively, 0.4% of Hewlett Packard Enterprise shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of recent ratings for Agilysys and Hewlett Packard Enterprise, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Agilysys	0	2	6	0	2.75
Hewlett Packard Enterprise	0	12	8	1	2.48

Agilysys currently has a consensus target price of $121.57, indicating a potential upside of 9.74%. Hewlett Packard Enterprise has a consensus target price of $25.50, indicating a potential upside of 11.60%. Given Hewlett Packard Enterprise’s higher possible upside, analysts clearly believe Hewlett Packard Enterprise is more favorable than Agilysys.

Risk & Volatility

Agilysys has a beta of 0.61, meaning that its share price is 39% less volatile than the S&P 500. Comparatively, Hewlett Packard Enterprise has a beta of 1.45, meaning that its share price is 45% more volatile than the S&P 500.

Summary

Agilysys beats Hewlett Packard Enterprise on 8 of the 15 factors compared between the two stocks.

About Agilysys

Agilysys, Inc. operates as a developer and marketer of software-enabled solutions and services to the hospitality industry in North America, Europe, the Asia-Pacific, and India. It offers software solutions fully integrated with third party hardware and operating systems; cloud applications, support, and maintenance; subscription and maintenance; and professional services. The company’s hospitality software solutions include hospitality experience cloud offers solution ecosystems that combine core operational systems for property management, point-of-sale (POS), and inventory and procurement; and Hospitality Solution Studios. Its food and beverage ecosystem solutions comprise InfoGenesis POS; IG Kiosk; IG Flex; IG KDS; IG OnDemand; IG Fly; IG Quick Pay; IG Smart Menu; IG Digital Menu Board; IG PanOptic AI-powered self-checkout kiosk; Pay, a payment processing solution; eCash for cashless tender; gift card solution; and Analyze, a cloud-based data analytic platform. The company’s inventory and procurement ecosystem solutions include Eatec solution and Stratton Warren System; LMS, a on-premise or hosted, web and mobile-enabled PMS solution; Versa, a hospitality solution; and Stay, a cloud-native SaaS property management system. Its hospitality and leisure and experience enhancer solutions comprise Book, Express Kiosk and Express Mobile for check-in and check-out; Spa software; Golf; Sales & Catering; Service; Authorize; DataMagine; Reserve solution; Digital Marketing solution; Retail POS solution; Central Reservations; Loyalty & Promotions; Membership; Residence Management; and Guest App. It serves hotels, resorts and cruise lines, casinos, corporate food service management, restaurants, universities, stadiums, and healthcare. The company was formerly known as Pioneer-Standard Electronics, Inc. and changed its name to Agilysys, Inc. in 2003. Agilysys, Inc. was founded in 1932 and is headquartered in Alpharetta, Georgia.

About Hewlett Packard Enterprise

Hewlett Packard Enterprise Company provides solutions that allow customers to capture, analyze, and act upon data seamlessly in the Americas, Europe, the Middle East, Africa, the Asia Pacific, and Japan. It operates in six segments: Compute, HPC & AI, Storage, Intelligent Edge, Financial Services, and Corporate Investments and Other. The company offers general purpose servers for multi-workload computing and workload-optimized servers; HPE ProLiant rack and tower servers; HPE Synergy; HPE Alletra, HPE GreenLake, Zerto, HPE InfoSight, and HPE CloudPhysics storage products; HPE Cray EX, HPE Cray XD, and converged edge systems; and HPE Superdome Flex, HPE Nonstop, and HPE Integrity products. It also provides HPE Aruba products that includes hardware products, such as Wi-Fi access points, switches, and gateways; HPE Aruba Networking software and services comprising cloud-based management, network management and access control, analytics and assurance, software-defined wide-area networking, network security, analytics and assurance, and location services software; and professional and support services, as well as as-a-service and consumption models. In addition, the company offers leasing, financing, IT consumption, and utility programs and asset management services for customers to facilitate technology deployment models and the acquisition of various IT solutions, including hardware, software, and services from Hewlett Packard Enterprise and others; consultative-led services; HPE Ezmeral Container Platform; HPE Ezmeral Software Container Platform and HPE Ezmeral Software Data Fabric; OpsRamp; and Hewlett Packard Labs. It serves commercial and large enterprise groups, such as business and public sector enterprises; and through various partners comprising resellers, distribution partners, original equipment manufacturers, independent software vendors, systems integrators, and advisory firms. The company was founded in 1939 and is headquartered in Spring, Texas.