Reviewing Amadeus IT Group (OTCMKTS:AMADY) & Cognizant Technology Solutions (NASDAQ:CTSH)

Cognizant Technology Solutions (NASDAQ:CTSH) and Amadeus IT Group (OTCMKTS:AMADY) are both large-cap technology companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, valuation, profitability, analyst recommendations, dividends, earnings and institutional ownership.

Dividends

Cognizant Technology Solutions pays an annual dividend of $1.32 per share and has a dividend yield of 2.3%. Amadeus IT Group pays an annual dividend of $1.72 per share and has a dividend yield of 2.7%. Cognizant Technology Solutions pays out 28.4% of its earnings in the form of a dividend. Amadeus IT Group pays out 48.7% 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. Cognizant Technology Solutions has raised its dividend for 6 consecutive years.

Institutional & Insider Ownership

92.4% of Cognizant Technology Solutions shares are owned by institutional investors. 0.4% of Cognizant Technology Solutions shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of current ratings and price targets for Cognizant Technology Solutions and Amadeus IT Group, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cognizant Technology Solutions	1	13	10	0	2.38
Amadeus IT Group	1	2	3	0	2.33

Cognizant Technology Solutions presently has a consensus price target of $63.00, indicating a potential upside of 7.92%. Given Cognizant Technology Solutions’ stronger consensus rating and higher probable upside, research analysts clearly believe Cognizant Technology Solutions is more favorable than Amadeus IT Group.

Valuation and Earnings

This table compares Cognizant Technology Solutions and Amadeus IT Group”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Cognizant Technology Solutions	$21.11 billion	1.25	$2.23 billion	$4.65	12.55
Amadeus IT Group	$7.37 billion	3.72	$1.51 billion	$3.53	17.99

Cognizant Technology Solutions has higher revenue and earnings than Amadeus IT Group. Cognizant Technology Solutions is trading at a lower price-to-earnings ratio than Amadeus IT Group, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Cognizant Technology Solutions has a beta of 0.83, meaning that its share price is 17% less volatile than the S&P 500. Comparatively, Amadeus IT Group has a beta of 0.84, meaning that its share price is 16% less volatile than the S&P 500.

Profitability

This table compares Cognizant Technology Solutions and Amadeus IT Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Cognizant Technology Solutions	10.26%	17.70%	12.81%
Amadeus IT Group	19.86%	29.84%	12.46%

Summary

Cognizant Technology Solutions beats Amadeus IT Group on 11 of the 17 factors compared between the two stocks.

About Cognizant Technology Solutions

Cognizant Technology Solutions Corporation, a professional services company, provides consulting and technology, and outsourcing services in North America, Europe, and internationally. It operates through four segments: Financial Services, Health Sciences, Products and Resources, and Communications, Media and Technology. The company provides customer experience, robotic process automation, analytics, and AI services in areas, such as digital lending, fraud detection, and next generation payments; the shift towards consumerism, outcome-based contracting, digital health, delivering integrated seamless, omni-channel, and patient-centered experience; and services that drive operational improvements in areas, such as clinical development, pharmacovigilance, and manufacturing, as well as claims processing, enrollment, membership, and billing to healthcare providers and payers, and life sciences companies, including pharmaceutical, biotech, and medical device companies. It offers solution to manufacturers, automakers, retailers and travel and hospitality companies, as well as companies providing logistics, energy and utility services; and digital content, business process improvement, technology modernization, and the creation of unified and compelling user experience services to communications, media and entertainment, education, and information services and technology companies. The company was incorporated in 1988 and is headquartered in Teaneck, New Jersey.

About Amadeus IT Group

Amadeus IT Group, S.A., together with its subsidiaries, operates as a transaction processor for the travel and tourism industry worldwide. The company operates through three segments: Air Distribution, Air IT Solutions, and Hospitality & Other Solutions. The company acts as an international network providing real-time search, pricing, booking, and ticketing services, and other processing solutions through Amadeus GDS, Altéa PSS, and New Skies platforms. It also offers travel providers a portfolio of technology solutions, which automate certain mission-critical business processes, such as reservations, inventory management, and departure control. In addition, the company is involved in the provision of software development and definition, software distribution, regional support, data processing, intermediation, computer consulting, installation of industrial machinery and equipment, consultancy and technology development services for payments, and information technology services; financial activities; and e-commerce business. It serves providers of travel products and services, such as airlines, airports, hotels, tour operators, insurance companies, land and sea transport companies, travel sellers and brokers, and travel buyers. The company was formerly known as Amadeus IT Holding, S.A. and changed its name to Amadeus IT Group, S.A. in August 2016. Amadeus IT Group, S.A. was founded in 1987 and is headquartered in Madrid, Spain.