Analyzing Star Equity (NASDAQ:STRR) and DLH (NASDAQ:DLHC)

DLH (NASDAQ:DLHC – Get Free Report) and Star Equity (NASDAQ:STRR – Get Free Report) are both small-cap industrials companies, but which is the better business? We will compare the two companies based on the strength of their dividends, institutional ownership, profitability, analyst recommendations, earnings, valuation and risk.

Institutional & Insider Ownership

67.2% of DLH shares are held by institutional investors. Comparatively, 3.8% of Star Equity shares are held by institutional investors. 12.8% of DLH shares are held by company insiders. Comparatively, 31.6% of Star Equity shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of recent ratings for DLH and Star Equity, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
DLH 1 1 1 0 2.00
Star Equity 1 1 1 1 2.50

Star Equity has a consensus price target of $28.00, indicating a potential upside of 173.84%. Given Star Equity’s stronger consensus rating and higher probable upside, analysts clearly believe Star Equity is more favorable than DLH.

Risk & Volatility

DLH has a beta of 1.52, meaning that its share price is 52% more volatile than the S&P 500. Comparatively, Star Equity has a beta of 0.5, meaning that its share price is 50% less volatile than the S&P 500.

Profitability

This table compares DLH and Star Equity’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
DLH -8.51% -10.42% -4.04%
Star Equity -4.35% -4.21% -2.39%

Earnings and Valuation

This table compares DLH and Star Equity”s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
DLH $344.50 million 0.17 $1.36 million ($1.48) -2.81
Star Equity $172.16 million 0.22 -$5.92 million ($3.06) -3.34

DLH has higher revenue and earnings than Star Equity. Star Equity is trading at a lower price-to-earnings ratio than DLH, indicating that it is currently the more affordable of the two stocks.

Summary

Star Equity beats DLH on 8 of the 14 factors compared between the two stocks.

About DLH

(Get Free Report)

DLH Holdings Corp. provides technology-enabled business process outsourcing, program management solutions, and public health research and analytics services in the United States. It offers digital transformation and cyber security solutions, including artificial intelligence and machine learning, cloud enablement, cybersecurity ecosystem, big data analytics, and modeling and simulation to the National Institutes of Health (NIH), the Defense Health Agency, Tele-medicine and Advanced Technology Research Center, and US Navy Naval Information Warfare Center (NIWC). The company also provides science research and development services and solutions, such as data analytics, testing and evaluation, clinical trials research services, and epidemiology studies to support multiple operating divisions, including NIH and the Center for Disease Control and Prevention, as well as the Military Health System. In addition, it offers system engineering and integration solutions in the areas of pharmaceutical delivery logistics, fire protection engineering, biomedical equipment, and technology engineering on behalf of the Department of Veterans Affairs, NIWC, Health and Human Services, and other federal customers. The company also provides business process management services under the trademarks, e-PRAT and SPOT-m, as well as the registered trademark, Infinibyte for cloud-based solutions. The company was formerly known as TeamStaff, Inc. and changed its name to DLH Holdings Corp. in June 2012. DLH Holdings Corp. was incorporated in 1969 and is headquartered in Atlanta, Georgia.

About Star Equity

(Get Free Report)

Star Equity Holdings, Inc. engages in the construction business in the United States and internationally. It operates through two segments: Construction, and Investments. It manufactures modular housing units, structural wall panels, permanent wood foundation systems, and other engineered wood products; supplies general contractors with building materials; holds real estate assets; and manages investments. The company was formerly known as Digirad Corporation and changed its name to Star Equity Holdings, Inc. in December 2020. Star Equity Holdings, Inc. was founded in 1985 and is headquartered in Old Greenwich, Connecticut.

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