Comparing The Ultimate Software Group (ULTI) and MINDBODY (MB)

The Ultimate Software Group (NASDAQ: ULTI) and MINDBODY (NASDAQ:MB) are both computer and technology companies, but which is the superior business? We will compare the two companies based on the strength of their analyst recommendations, risk, profitability, dividends, valuation, institutional ownership and earnings.

Profitability

This table compares The Ultimate Software Group and MINDBODY’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
The Ultimate Software Group 3.31% 6.84% 2.45%
MINDBODY -9.26% -8.39% -6.68%

Volatility and Risk

The Ultimate Software Group has a beta of 1.08, indicating that its stock price is 8% more volatile than the S&P 500. Comparatively, MINDBODY has a beta of -0.31, indicating that its stock price is 131% less volatile than the S&P 500.

Valuation and Earnings

This table compares The Ultimate Software Group and MINDBODY’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
The Ultimate Software Group $781.29 million 7.92 $30.25 million $0.97 213.51
MINDBODY $139.02 million 10.28 -$22.97 million ($0.38) -80.53

The Ultimate Software Group has higher revenue and earnings than MINDBODY. MINDBODY is trading at a lower price-to-earnings ratio than The Ultimate Software Group, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

90.2% of MINDBODY shares are held by institutional investors. 4.9% of The Ultimate Software Group shares are held by company insiders. Comparatively, 8.2% of MINDBODY shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of current ratings and price targets for The Ultimate Software Group and MINDBODY, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
The Ultimate Software Group 1 4 16 0 2.71
MINDBODY 0 2 8 0 2.80

The Ultimate Software Group currently has a consensus target price of $231.58, suggesting a potential upside of 11.82%. MINDBODY has a consensus target price of $32.15, suggesting a potential upside of 5.07%. Given The Ultimate Software Group’s higher probable upside, analysts clearly believe The Ultimate Software Group is more favorable than MINDBODY.

Summary

The Ultimate Software Group beats MINDBODY on 9 of the 13 factors compared between the two stocks.

The Ultimate Software Group Company Profile

The Ultimate Software Group, Inc. (Ultimate) is a cloud provider of people management solutions, referred to as human capital management (HCM). The Company’s UltiPro product suite (UltiPro) is an engaging solution that has human resources (HR), payroll and benefits management. As of December 31, 2016, UltiPro included global people management, available in 14 languages with more than 35 country-specific localizations. The solution is delivered through software-as-a-service (SaaS) to organizations based in the United States and Canada, including those with global workforces. The UltiPro solution includes feature sets for talent acquisition and onboarding, HR management and compliance, benefits management and online enrollment, payroll, performance management, compensation management with salary planning, budgeting, and development of incentive plans, succession management, reporting and analytical decision-making and predictive tools, and time and attendance.

MINDBODY Company Profile

MINDBODY, Inc. is a provider of cloud-based business management software for the wellness services industry and operates as a consumer marketplace with local business subscribers on its platform. The Company’s subscribers provide a range of wellness services to active consumers. Its integrated software and payments platform helps business owners in the wellness services industry run, market and build their businesses. It also helps consumers discover, evaluate, engage and transact with these businesses through the Web and mobile devices. The platform addresses various aspects of operating a wellness business, including client scheduling and online booking; retail point-of-sale; analytics and reporting; user experience; mobility; social integration; dynamic cloud-based architecture; open platform for third-party application development; integration with other cloud-based partners, and security and compliance.

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