Analyzing Franklin Covey (NYSE:FC) & Barrett Business Services (NASDAQ:BBSI)

Barrett Business Services (NASDAQ:BBSI) and Franklin Covey (NYSE:FC) are both small-cap industrials companies, but which is the better stock? We will contrast the two companies based on the strength of their dividends, analyst recommendations, institutional ownership, risk, profitability, earnings and valuation.

Analyst Ratings

This is a breakdown of recent recommendations for Barrett Business Services and Franklin Covey, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Barrett Business Services	0	3	2	1	2.67
Franklin Covey	1	1	2	0	2.25

Barrett Business Services currently has a consensus price target of $41.00, suggesting a potential upside of 26.04%. Franklin Covey has a consensus price target of $27.50, suggesting a potential upside of 52.19%. Given Franklin Covey’s higher possible upside, analysts plainly believe Franklin Covey is more favorable than Barrett Business Services.

Risk and Volatility

Barrett Business Services has a beta of 0.94, indicating that its stock price is 6% less volatile than the S&P 500. Comparatively, Franklin Covey has a beta of 0.77, indicating that its stock price is 23% less volatile than the S&P 500.

Institutional and Insider Ownership

86.8% of Barrett Business Services shares are held by institutional investors. Comparatively, 69.9% of Franklin Covey shares are held by institutional investors. 4.8% of Barrett Business Services shares are held by company insiders. Comparatively, 15.2% of Franklin Covey shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Barrett Business Services and Franklin Covey’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Barrett Business Services	2.77%	20.95%	6.11%
Franklin Covey	0.83%	17.37%	4.04%

Earnings & Valuation

This table compares Barrett Business Services and Franklin Covey”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Barrett Business Services	$1.24 billion	0.64	$54.45 million	$1.36	23.92
Franklin Covey	$267.07 million	0.76	$3.07 million	$0.17	106.29

Barrett Business Services has higher revenue and earnings than Franklin Covey. Barrett Business Services is trading at a lower price-to-earnings ratio than Franklin Covey, indicating that it is currently the more affordable of the two stocks.

Summary

Barrett Business Services beats Franklin Covey on 10 of the 14 factors compared between the two stocks.

About Barrett Business Services

Barrett Business Services, Inc. provides business management solutions for small and mid-sized companies in the United States. The company develops a management platform that integrates a knowledge-based approach from the management consulting industry with tools from the human resource outsourcing industry. It offers professional employer services under which it enters into a client services agreement to establish a co-employment relationship with each client company, assuming responsibility for payroll, payroll taxes, workers compensation coverage, and other administration functions for the client’s existing workforce. The company provides staffing and recruiting services, such as on-demand or short-term staffing assignment, contract staffing, direct placement, and long-term or indefinite-term on-site management services. It serves electronics manufacturers, light-manufacturing industries, agriculture-based companies, transportation and shipping enterprises, food processors, telecommunications companies, public utilities, general contractors in various construction-related fields, restaurant franchises, and professional services firms. Barrett Business Services, Inc. was incorporated in 1965 and is headquartered in Vancouver, Washington.

About Franklin Covey

Franklin Covey Co. provides training and consulting services in the areas of execution, sales performance, productivity, customer loyalty, and educational improvement for organizations and individuals worldwide. The company operates through Direct Offices, International Licensees, and Education Practice segments. It also provides a suite of individual-effectiveness and leadership-development training and products. In addition, the company operates Strive platform, a learning deployment platform; Impact platform that helps automate implementation of learning initiatives; All Access Pass, a subscription platform that enables improved deployment of content, services, technology, and metrics to deliver behavioral impact at scale; and Leader in Me, which provides access to digital versions of student leadership guides, leadership lessons, illustrated leadership stories, and other resources. Franklin Covey Co. was incorporated in 1983 and is headquartered in Salt Lake City, Utah.