Comparing DST Systems (DST) and DXC Technology (DXC)

DST Systems (NYSE:DST) and DXC Technology (NYSE:DXC) are both computer and technology companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, risk, analyst recommendations, valuation, profitability, earnings and dividends.

Dividends

DST Systems pays an annual dividend of $0.72 per share and has a dividend yield of 0.9%. DXC Technology pays an annual dividend of $0.76 per share and has a dividend yield of 1.2%. DXC Technology pays out 9.6% of its earnings in the form of a dividend. DST Systems has increased its dividend for 3 consecutive years.

Profitability

This table compares DST Systems and DXC Technology’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
DST Systems N/A N/A N/A
DXC Technology 7.09% 19.78% 8.00%

Earnings & Valuation

This table compares DST Systems and DXC Technology’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
DST Systems N/A N/A N/A N/A N/A
DXC Technology $24.56 billion 0.70 $1.75 billion $7.94 8.10

DXC Technology has higher revenue and earnings than DST Systems.

Analyst Ratings

This is a breakdown of current ratings for DST Systems and DXC Technology, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
DST Systems 0 0 0 0 N/A
DXC Technology 0 3 9 1 2.85

DXC Technology has a consensus price target of $93.91, indicating a potential upside of 45.96%. Given DXC Technology’s higher probable upside, analysts clearly believe DXC Technology is more favorable than DST Systems.

Institutional and Insider Ownership

85.7% of DST Systems shares are owned by institutional investors. Comparatively, 82.2% of DXC Technology shares are owned by institutional investors. 1.8% of DST Systems shares are owned by insiders. Comparatively, 0.7% of DXC Technology shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

DXC Technology beats DST Systems on 8 of the 12 factors compared between the two stocks.

About DST Systems

DST Systems, Inc. provides technology-based information processing and servicing solutions in the United States, the United Kingdom, Canada, Australia, and internationally. It operates through Domestic Financial Services, International Financial Services, and Healthcare Services segments. The Domestic Financial Services segment provides investor, investment, advisor/intermediary, and asset distribution services to companies in the financial services industry to support direct and intermediary sales of mutual funds, alternative investments, securities brokerage accounts, and retirement plans. Its services include transaction processing; account opening and maintenance; reconciliation of trades, positions, and cash; corporate actions; regulatory reporting and compliance functions; and tax reporting. The International Financial Services segment offers investor and policyholder administration and technology services on a remote processing and business process outsourcing basis to mutual fund managers, insurers, and platform providers, as well as provides solutions related to participant accounting and recordkeeping for clients in the wealth management and retirement savings industries/markets. Its Healthcare Services segment offers software applications to provide healthcare organizations with pharmacy, healthcare administration, and health outcomes optimization solutions for information processing, quality of care, cost management, and payment integrity needs; and healthcare solutions, including claims adjudication, benefit management, care management, business intelligence, and other ancillary services. The company was founded in 1968 and is headquartered in Kansas City, Missouri.

About DXC Technology

DXC Technology Company, together with its subsidiaries, provides information technology services and solutions primarily in North America, Europe, Asia, and Australia. It operates through three segments: Global Business Services (GBS), Global Infrastructure Services (GIS), and United States Public Sector (USPS). The GBS segment offers technology solutions comprising enterprise, cloud application, and consulting services; application services; analytics services; business process services; and industry software and solutions. The GIS segment offers cloud and platform services; workplace, mobility, and Internet of Things services; and security solutions. The USPS segment delivers IT services and business solutions to all levels of government in the United States. This segment offers cloud, platform, and IT outsourcing services; enterprise and cloud application services; enterprise security solutions; mobile enterprise, virtual desktop and application, and workplace device services; and analytics services, such as analytics platforms, information governance, artificial intelligence, and advisory services. The company was formerly known as Computer Sciences Corporation and changed its name to DXC Technology Company in April 2017 as a result of its merger with the Enterprise Services business of Hewlett Packard Enterprise Company. DXC Technology Company was founded in 1959 and is headquartered in Tysons, Virginia.

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