Thomson Reuters (NASDAQ:TRI – Get Free Report) and Hays (OTCMKTS:HAYPF – Get Free Report) are both industrials companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, dividends, analyst recommendations, risk, profitability and earnings.
Insider and Institutional Ownership
17.3% of Thomson Reuters shares are held by institutional investors. Comparatively, 36.8% of Hays shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
Earnings and Valuation
This table compares Thomson Reuters and Hays”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Thomson Reuters | $7.48 billion | 5.93 | $1.50 billion | $3.76 | 27.08 |
| Hays | N/A | N/A | N/A | $0.06 | 11.34 |
Thomson Reuters has higher revenue and earnings than Hays. Hays is trading at a lower price-to-earnings ratio than Thomson Reuters, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Thomson Reuters and Hays’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Thomson Reuters | 21.22% | 15.82% | 10.27% |
| Hays | N/A | N/A | N/A |
Analyst Recommendations
This is a summary of recent ratings and target prices for Thomson Reuters and Hays, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Thomson Reuters | 1 | 5 | 10 | 1 | 2.65 |
| Hays | 0 | 0 | 0 | 0 | 0.00 |
Thomson Reuters presently has a consensus target price of $142.83, suggesting a potential upside of 40.26%. Given Thomson Reuters’ stronger consensus rating and higher probable upside, equities research analysts clearly believe Thomson Reuters is more favorable than Hays.
Dividends
Thomson Reuters pays an annual dividend of $2.62 per share and has a dividend yield of 2.6%. Hays pays an annual dividend of $0.03 per share and has a dividend yield of 3.5%. Thomson Reuters pays out 69.7% of its earnings in the form of a dividend. Hays pays out 39.4% 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. Hays is clearly the better dividend stock, given its higher yield and lower payout ratio.
Summary
Thomson Reuters beats Hays on 10 of the 13 factors compared between the two stocks.
About Thomson Reuters
Thomson Reuters Corporation provides business information services in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. It operates in five segments: Legal Professionals, Corporates, Tax & Accounting Professionals, Reuters News, and Global Print. The Legal Professionals segment offers research and workflow products focusing on legal research and integrated legal workflow solutions that combine content, tools, and analytics to law firms and governments. The Corporates segment provides a suite of content-enabled technology solutions for legal, tax, regulatory, compliance, and IT professionals. The Tax & Accounting Professionals segment offers research and workflow products focusing on tax offerings and automating tax workflows to tax, accounting, and audit professionals in accounting firms. The Reuters News segment provides business, financial, and international news to media organizations, professional, and news consumers through news agency and industry events. The Global Print segment offers legal and tax information primarily in print format to legal and tax professionals, governments, law schools, and corporations. The company was formerly known as The Thomson Corporation and changed its name to Thomson Reuters Corporation in April 2008. The company was founded in 1851 and is headquartered in Toronto, Canada. Thomson Reuters Corporation is a subsidiary of The Woodbridge Company Limited.
About Hays
Hays plc engages in the provision of recruitment services in Australia, New Zealand, Germany, the United Kingdom, Ireland, and internationally. The company provides qualified, professional, and skilled recruitment in permanent, temporary, and contractor formats to public and private sectors. It offers its recruitment services in the specialisms, such as accountancy and finance, banking and capital markets, construction and property, contact centers, education, energy, oil and gas, engineering and manufacturing, executive, financial services, health and social care, human resources, legal, life sciences, office support, procurement, resources and mining, retail, sales and marketing, sustainability, technology, and telecoms. Hays plc was founded in 1968 and is based in London, the United Kingdom.
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