Leidos (NYSE:LDOS – Get Free Report) and Amdocs (NASDAQ:DOX – Get Free Report) are both computer and technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, profitability, valuation, earnings, dividends and risk.
Institutional and Insider Ownership
76.1% of Leidos shares are owned by institutional investors. Comparatively, 92.0% of Amdocs shares are owned by institutional investors. 0.8% of Leidos shares are owned by insiders. Comparatively, 15.4% of Amdocs shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
Risk and Volatility
Leidos has a beta of 0.51, suggesting that its share price is 49% less volatile than the S&P 500. Comparatively, Amdocs has a beta of 0.38, suggesting that its share price is 62% less volatile than the S&P 500.
Earnings and Valuation
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Leidos | $17.17 billion | 0.89 | $1.45 billion | $10.92 | 11.18 |
| Amdocs | $4.53 billion | 1.34 | $564.70 million | $5.00 | 11.28 |
Leidos has higher revenue and earnings than Amdocs. Leidos is trading at a lower price-to-earnings ratio than Amdocs, indicating that it is currently the more affordable of the two stocks.
Dividends
Leidos pays an annual dividend of $1.72 per share and has a dividend yield of 1.4%. Amdocs pays an annual dividend of $2.28 per share and has a dividend yield of 4.0%. Leidos pays out 15.8% of its earnings in the form of a dividend. Amdocs pays out 45.6% 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. Leidos has raised its dividend for 6 consecutive years and Amdocs has raised its dividend for 14 consecutive years. Amdocs is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Profitability
This table compares Leidos and Amdocs’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Leidos | 8.15% | 31.92% | 11.23% |
| Amdocs | 11.81% | 19.77% | 10.87% |
Analyst Ratings
This is a summary of current ratings and target prices for Leidos and Amdocs, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Leidos | 0 | 7 | 6 | 1 | 2.57 |
| Amdocs | 1 | 2 | 3 | 0 | 2.33 |
Leidos currently has a consensus price target of $187.50, indicating a potential upside of 53.62%. Amdocs has a consensus price target of $86.67, indicating a potential upside of 53.66%. Given Amdocs’ higher possible upside, analysts plainly believe Amdocs is more favorable than Leidos.
Summary
Leidos beats Amdocs on 10 of the 18 factors compared between the two stocks.
About Leidos
Leidos Holdings, Inc., together with its subsidiaries, provides services and solutions in the defense, intelligence, civil, and health markets in the United States and internationally. The company operates through Defense Solutions, Civil, and Health segments. The Defense Solutions segment offers national security solutions and systems for air, land, sea, space, and cyberspace for the U.S. Intelligence Community, the Department of Defense, the space development agency, the National Aeronautics and Space Administration, defense information systems agency, military services, and government agencies of U.S. allies abroad, as well as other federal and commercial customers in the national security industry. The solutions include technology, large-scale systems, command and control platforms, data analytics, logistics, and cybersecurity solutions, as well as intelligence analysis and operations support services to critical missions. The Civil segment provides systems integration services to air navigation service providers, including the federal aviation administration, the En route automation modernization, advanced technology oceanic procedure, time based flow management, terminal flight data management, geo-7, and future flight services, as well as enterprise-information display systems; and security detection services. It also offers information technology (IT) solutions in cloud computing, mobility, application modernization, DevOps, data center, network modernization, asset management, help desk operations, and digital workplace enablement; and environment, energy, and infrastructure services. The Health segment offers solutions to federal and commercial customers responsible for health and well-being of people, include health information management, managed health, digital modernization, and life sciences research and development services. Leidos Holdings, Inc. was founded in 1969 and is headquartered in Reston, Virginia.
About Amdocs
Amdocs Limited, through its subsidiaries, provides software and services worldwide. It designs, develops, operates, implements, supports, and markets open and modular cloud portfolio. The company provides CES23, a 5G and cloud-native microservices-based market-leading customer experience suite, that enables service providers to build, deliver, and monetize advanced services; Amdocs Subscription Marketplace, a software-as-a-service-based platform that includes an expansive network of pre-integrated digital services, such as media, gaming, eLearning, sports, and retail to security and business services; the monetization suite for charging, billing, policy, and revenue management; Intelligent networking suite with a set of modular, flexible, and open service lifecycle management capabilities for network automation journeys; amAIz, a telco GenAI framework; Amdocs Digital Brands Suite, a pre-integrated digital business suite; and Amdocs eSIM Cloud for service providers. It also offers AI-powered, cloud-native, and home operating systems; data intelligence solutions and applications; end-to-end application development and maintenance services; and ongoing maintenance services. In addition, the company provides a line of services designed for various stages of a service provider’s lifecycle includes consulting, delivery, quality engineering, operations, systems integration, network services, experience-driven services, data, cloud, and content services; managed services comprising application development, modernization and maintenance, IT and infrastructure services, testing and professional services that are designed to assist customers in the selection, implementation, operation, management, and maintenance of IT systems. It serves to the communications, entertainment, and media industry service providers, as well as mobile virtual network operators. Amdocs Limited was founded in 1988 and is headquartered in Saint Louis, Missouri.
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