Head-To-Head Review: Verisk Analytics (NASDAQ:VRSK) and Exponent (NASDAQ:EXPO)

Exponent (NASDAQ:EXPO) and Verisk Analytics (NASDAQ:VRSK) are both industrials companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, valuation, institutional ownership, analyst recommendations, dividends, earnings and profitability.

Insider & Institutional Ownership

92.4% of Exponent shares are held by institutional investors. Comparatively, 90.0% of Verisk Analytics shares are held by institutional investors. 1.7% of Exponent shares are held by insiders. Comparatively, 0.5% of Verisk Analytics shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares Exponent and Verisk Analytics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Exponent	17.67%	31.48%	15.53%
Verisk Analytics	28.24%	-239.55%	18.56%

Dividends

Exponent pays an annual dividend of $1.24 per share and has a dividend yield of 1.6%. Verisk Analytics pays an annual dividend of $2.00 per share and has a dividend yield of 1.0%. Exponent pays out 55.6% of its earnings in the form of a dividend. Verisk Analytics pays out 30.7% 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. Exponent has increased its dividend for 12 consecutive years and Verisk Analytics has increased its dividend for 6 consecutive years. Exponent is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation and Earnings

This table compares Exponent and Verisk Analytics”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Exponent	$582.01 million	6.33	$106.01 million	$2.23	34.72
Verisk Analytics	$3.07 billion	8.30	$908.30 million	$6.51	30.09

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

Volatility & Risk

Exponent has a beta of 0.69, meaning that its share price is 31% less volatile than the S&P 500. Comparatively, Verisk Analytics has a beta of 0.69, meaning that its share price is 31% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings for Exponent and Verisk Analytics, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Exponent	0	2	2	0	2.50
Verisk Analytics	0	8	6	1	2.53

Exponent currently has a consensus price target of $81.00, suggesting a potential upside of 4.61%. Verisk Analytics has a consensus price target of $224.79, suggesting a potential upside of 14.76%. Given Verisk Analytics’ stronger consensus rating and higher possible upside, analysts plainly believe Verisk Analytics is more favorable than Exponent.

Summary

Verisk Analytics beats Exponent on 11 of the 17 factors compared between the two stocks.

About Exponent

Exponent, Inc., together with its subsidiaries, operates as a science and engineering consulting company in the United States and internationally. The company operates in two segments, Engineering and Other Scientific, and Environmental and Health. The Engineering and Other Scientific segment provides services in the areas of biomechanics, biomedical engineering and sciences, buildings and structures, civil engineering, construction consulting, data sciences, electrical engineering and computer science, human factors, materials and corrosion engineering, mechanical engineering, polymer science and materials chemistry, thermal sciences, and vehicle engineering. The Environmental and Health segment offers services in the areas of chemical regulation and food safety, ecological and biological sciences, environmental and earth sciences, and health sciences. The company offers approximately 90 technical disciplines to solve pressing and complicated challenges facing stakeholders. It serves clients in chemical, construction, consumer products, energy, food, beverage and nutrition, government, life sciences, insurance, manufacturing, technology, industrial equipment, transportation, and other sectors of the economy. The company was formerly known as The Failure Group, Inc. and changed its name to Exponent, Inc. in 1998. The company was founded in 1967 and is headquartered in Menlo Park, California.

About Verisk Analytics

Verisk Analytics, Inc. provides data analytics and technology solutions to the insurance markets in the United States and internationally. It offers policy language, prospective loss costs, policy writing and rating rules, and various underwriting solutions for risk selection and segmentation, pricing, and workflow optimization; property- and auto- specific rating and underwriting information solutions that allows clients to understand, quantify, underwrite, mitigate, and avoid potential loss for risks; catastrophe modeling solutions, which enables companies to identify, quantify, and plan for the financial consequences of catastrophes for use by insurers, reinsurers, intermediaries, financial institutions, and governments. The company also provides life insurance solutions for transforming current workflows in life insurance underwriting, claim insights, policy administration, unclaimed property/equity, compliance and fraud detection, and actuarial and portfolio modeling; Marketing Solutions, such as compliant, real-time decisioning, profitability, and risk assessment for inbound consumer interactions; and international underwriting and claims solutions. In addition, it offers claims insurance solutions, which provides analytics in fraud detection, compliance reporting, subrogation liability assessment, litigation, and repair cost estimation and valuation solutions; and casualty solutions, such as compliance, casualty claims decision support, and workflow automation solutions. Further, the company supplies software to the specialty insurance market. The company was founded in 1971 and is headquartered in Jersey City, New Jersey.