Head-To-Head Analysis: NEC (OTCMKTS:NIPNF) vs. Infosys (NYSE:INFY)

NEC (OTCMKTS:NIPNF) and Infosys (NYSE:INFY) are both technology companies, but which is the better stock? We will contrast the two companies based on the strength of their earnings, institutional ownership, valuation, risk, dividends, profitability and analyst recommendations.

Volatility and Risk

NEC has a beta of -0.47, suggesting that its share price is 147% less volatile than the S&P 500. Comparatively, Infosys has a beta of 0.9, suggesting that its share price is 10% less volatile than the S&P 500.

Institutional & Insider Ownership

16.2% of Infosys shares are owned by institutional investors. 22.4% of Infosys shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares NEC and Infosys”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NEC	$25.69 billion	0.32	$412.83 million	$1.64	19.24
Infosys	$20.16 billion	2.42	$3.31 billion	$0.81	14.87

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

Analyst Recommendations

This is a summary of recent ratings and recommmendations for NEC and Infosys, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NEC	0	0	0	0	0.00
Infosys	2	8	0	0	1.80

Infosys has a consensus target price of $11.63, indicating a potential downside of 3.44%. Given Infosys’ stronger consensus rating and higher probable upside, analysts clearly believe Infosys is more favorable than NEC.

Profitability

This table compares NEC and Infosys’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NEC	N/A	N/A	N/A
Infosys	16.38%	33.91%	20.54%

Summary

Infosys beats NEC on 10 of the 13 factors compared between the two stocks.

About NEC

NEC Corporation provides information and communication technology solutions in Japan and internationally. It operates through five segments: Public Solutions Business, Public Infrastructure Business, Enterprise Business, Network Services Business, and Global Business. It provides systems integration services, including systems implementation and consulting; maintenance and support services; outsourcing and cloud services; and system equipment. The company also offers network infrastructure products comprising core network equipment, mobile phone base stations, optical transmission systems, and routers and switches; and services and management solutions, such as operation support system (OSS), business support system (BSS), and services. In addition, it provides digital government and digital finance solutions; software services for service providers, including OSS/BSS; and network infrastructure comprising submarine systems and wireless backhaul. Further, the company offers business computers, servers, NEC HPC solutions, and thin client solutions; data storage solutions; embedded systems; fiber optic devices; CONNEXIVE, an IoT platform software; PASOLINK, a mobile backhaul; optical fiber sensing products; submarine systems; and open optical transport products. Additionally, it provides EXPRESSCLUSTER X, a BC/DR solutions; NIAS, a solution for file server management; ERP solutions; MasterScope, an integrated administration software suite; Obbligato, a product lifecycle management; SaaS Solutions; WebOTX, a service execution platform; and unified communications and collaboration solutions. It serves aerospace, agriculture, aviation, broadcasting, finance, government, healthcare, hospitality, logistics, manufacturing, retail, telecom, and transportation industries. The company was formerly known as Nippon Electric Company, Limited and changed its name to NEC Corporation in April 1983. NEC Corporation was incorporated in 1899 and is headquartered in Tokyo, Japan.

About Infosys

Infosys Ltd. is a digital services and consulting company, which engages in the provision of end-to-end business solutions. It operates through the following segments: Financial Services, Retail, Communication, Energy, Utilities, Resources, and Services, Manufacturing, Hi-Tech, Life Sciences, and All Other. The company was founded by Dinesh Krishnan Swamy, Senapathy Gopalakrishnan, Narayana Ramarao Nagavara Murthy, Raghavan N. S., Ashok Arora, Nandan M. Nilekani, and S. D. Shibulal on July 2, 1981 and is headquartered in Bangalore, India.