Reviewing Wipro (WIT) & Black Knight Financial Services (BKFS)

Wipro (NYSE: WIT) and Black Knight Financial Services (NYSE:BKFS) are both mid-cap computer and technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, earnings, dividends, profitability, risk, institutional ownership and analyst recommendations.

Analyst Ratings

This is a breakdown of current ratings and price targets for Wipro and Black Knight Financial Services, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Wipro 3 1 0 0 1.25
Black Knight Financial Services 0 1 6 0 2.86

Wipro presently has a consensus target price of $277.00, indicating a potential upside of 5,087.27%. Black Knight Financial Services has a consensus target price of $46.50, indicating a potential upside of 8.01%. Given Wipro’s higher probable upside, analysts clearly believe Wipro is more favorable than Black Knight Financial Services.

Institutional and Insider Ownership

2.4% of Wipro shares are owned by institutional investors. Comparatively, 44.7% of Black Knight Financial Services shares are owned by institutional investors. 1.0% of Wipro shares are owned by insiders. Comparatively, 30.8% of Black Knight Financial Services shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares Wipro and Black Knight Financial Services’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Wipro $8.49 billion 3.06 $1.31 billion $0.28 19.42
Black Knight Financial Services N/A N/A N/A $0.63 68.33

Wipro has higher revenue and earnings than Black Knight Financial Services. Wipro is trading at a lower price-to-earnings ratio than Black Knight Financial Services, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Wipro and Black Knight Financial Services’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Wipro 15.77% 16.14% 10.57%
Black Knight Financial Services 16.64% 4.71% 4.71%

Dividends

Wipro pays an annual dividend of $0.01 per share and has a dividend yield of 0.2%. Black Knight Financial Services does not pay a dividend. Wipro pays out 3.6% of its earnings in the form of a dividend.

Summary

Black Knight Financial Services beats Wipro on 7 of the 12 factors compared between the two stocks.

Wipro Company Profile

Wipro Limited (Wipro) is a global information technology (IT) services provider. It operates through two segments: IT Services and IT Products. The Company’s IT Services business provides a range of IT and IT-enabled services, which include digital strategy advisory, customer centric design, technology consulting, IT consulting, custom application design, development, re-engineering and maintenance, systems integration, package implementation, global infrastructure services, analytics services, business process services, research and development and hardware and software design. The IT Products segment provides a range of third-party IT products, which allows it to offer IT system integration services. Its products include computing, Platforms and Storage, Networking Solutions, Enterprise Information Security, and software products, including databases and operating systems. The Company is a reseller of third-party enterprise products through its direct sales force.

Black Knight Financial Services Company Profile

Black Knight Financial Services, Inc. is a holding company. The Company, through its subsidiaries, provides integrated technology, workflow automation, and data and analytics to the mortgage and real estate industries. The Company’s segments include Technology, and Data and Analytics. The Company’s Technology segment offers software and hosting solutions that support loan servicing, loan origination and settlement services. The Technology segment provides applications and services, such as servicing technology and origination technology. Its Data and Analytics segment offers data and analytics solutions to the mortgage, real estate and capital markets industries. These solutions include property ownership data, lien data, servicing data, automated valuation models, collateral risk scores, prepayment and default models, lead generation and other data solutions.

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