Maximus (NYSE:MMS) and Leidos (NYSE:LDOS) Head to Head Analysis

Leidos (NYSE:LDOS) and Maximus (NYSE:MMS) are both industrials companies, but which is the better stock? We will contrast the two companies based on the strength of their valuation, analyst recommendations, risk, earnings, institutional ownership, profitability and dividends.

Profitability

This table compares Leidos and Maximus’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Leidos	7.80%	30.81%	10.78%
Maximus	7.07%	24.91%	10.08%

Analyst Ratings

This is a breakdown of current recommendations for Leidos and Maximus, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Leidos	0	10	5	1	2.44
Maximus	0	2	0	0	2.00

Leidos presently has a consensus target price of $156.14, indicating a potential upside of 14.75%. Given Leidos’ stronger consensus rating and higher probable upside, research analysts clearly believe Leidos is more favorable than Maximus.

Dividends

Leidos pays an annual dividend of $1.72 per share and has a dividend yield of 1.3%. Maximus pays an annual dividend of $1.32 per share and has a dividend yield of 2.1%. Leidos pays out 16.0% of its earnings in the form of a dividend. Maximus pays out 19.5% 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. Leidos has raised its dividend for 6 consecutive years and Maximus has raised its dividend for 2 consecutive years.

Volatility and Risk

Leidos has a beta of 0.58, meaning that its share price is 42% less volatile than the S&P 500. Comparatively, Maximus has a beta of 0.59, meaning that its share price is 41% less volatile than the S&P 500.

Insider & Institutional Ownership

76.1% of Leidos shares are held by institutional investors. Comparatively, 97.2% of Maximus shares are held by institutional investors. 0.8% of Leidos shares are held by insiders. Comparatively, 1.8% of Maximus shares are held by 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.

Valuation & Earnings

This table compares Leidos and Maximus”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Leidos	$17.63 billion	0.97	$1.45 billion	$10.72	12.69
Maximus	$5.43 billion	0.61	$319.03 million	$6.77	9.33

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

Summary

Leidos beats Maximus on 14 of the 18 factors compared between the two stocks.

About Leidos

Leidos Holdings, Inc., together with its subsidiaries, provides services and solutions in the defense, intelligence, civil, and health markets in the United States and internationally. The company operates through Defense Solutions, Civil, and Health segments. The Defense Solutions segment offers national security solutions and systems for air, land, sea, space, and cyberspace for the U.S. Intelligence Community, the Department of Defense, the space development agency, the National Aeronautics and Space Administration, defense information systems agency, military services, and government agencies of U.S. allies abroad, as well as other federal and commercial customers in the national security industry. The solutions include technology, large-scale systems, command and control platforms, data analytics, logistics, and cybersecurity solutions, as well as intelligence analysis and operations support services to critical missions. The Civil segment provides systems integration services to air navigation service providers, including the federal aviation administration, the En route automation modernization, advanced technology oceanic procedure, time based flow management, terminal flight data management, geo-7, and future flight services, as well as enterprise-information display systems; and security detection services. It also offers information technology (IT) solutions in cloud computing, mobility, application modernization, DevOps, data center, network modernization, asset management, help desk operations, and digital workplace enablement; and environment, energy, and infrastructure services. The Health segment offers solutions to federal and commercial customers responsible for health and well-being of people, include health information management, managed health, digital modernization, and life sciences research and development services. Leidos Holdings, Inc. was founded in 1969 and is headquartered in Reston, Virginia.

About Maximus

Maximus, Inc. operates as a provider of government services in the United States and internationally. It operates through three segments: U.S. Federal Services, U.S. Services, and Outside the U.S. The U.S. Services segment offers program eligibility support and enrollment; centralized multilingual customer contact centers, multichannel, and digital self-service options for enrollment; application assistance and independent health plan choice counseling; beneficiary outreach, education, eligibility, enrollment, and redeterminations; and person-centered independent disability, long-term sick, and other health assessments. This segment also provides employment services, such as eligibility support, case management, job-readiness preparation, job search and employer outreach, job retention and career advancement, and educational and training services; technology solutions; system implementation project management services; and specialized consulting services. The U.S. Federal Services segment offers Business process services, eligibility and enrollment, outreach, and other services for federal health and human services programs; clinical services; and technology solutions, including application development and modernization services, enterprise business solutions, advanced analytics and emerging technologies, cybersecurity services, and infrastructure and engineering solutions. The Outside the U.S. segment offers BPS solutions for international governments, including health and disability assessments, program administration for employment services, wellbeing solutions, and other job seeker-related services. Maximus, Inc. was founded in 1975 and is headquartered in McLean, Virginia.