Reviewing Information Services Group (NASDAQ:III) & Charles River Associates (NASDAQ:CRAI)

Charles River Associates (NASDAQ:CRAI) and Information Services Group (NASDAQ:III) are both small-cap business services companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, earnings, risk, valuation, analyst recommendations, profitability and institutional ownership.

Institutional and Insider Ownership

84.1% of Charles River Associates shares are owned by institutional investors. Comparatively, 73.1% of Information Services Group shares are owned by institutional investors. 4.7% of Charles River Associates shares are owned by insiders. Comparatively, 15.9% of Information Services Group shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares Charles River Associates and Information Services Group”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Charles River Associates	$731.06 million	1.61	$46.65 million	$8.32	21.59
Information Services Group	$241.29 million	1.07	$2.84 million	$0.19	28.47

Charles River Associates has higher revenue and earnings than Information Services Group. Charles River Associates is trading at a lower price-to-earnings ratio than Information Services Group, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Charles River Associates has a beta of 0.92, indicating that its stock price is 8% less volatile than the S&P 500. Comparatively, Information Services Group has a beta of 1.32, indicating that its stock price is 32% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Charles River Associates and Information Services Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Charles River Associates	0	0	2	0	3.00
Information Services Group	0	2	1	1	2.75

Charles River Associates currently has a consensus target price of $239.00, indicating a potential upside of 33.04%. Information Services Group has a consensus target price of $7.00, indicating a potential upside of 29.39%. Given Charles River Associates’ stronger consensus rating and higher possible upside, equities research analysts plainly believe Charles River Associates is more favorable than Information Services Group.

Dividends

Charles River Associates pays an annual dividend of $2.28 per share and has a dividend yield of 1.3%. Information Services Group pays an annual dividend of $0.18 per share and has a dividend yield of 3.3%. Charles River Associates pays out 27.4% of its earnings in the form of a dividend. Information Services Group pays out 94.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Charles River Associates has increased its dividend for 7 consecutive years and Information Services Group has increased its dividend for 1 consecutive years.

Profitability

This table compares Charles River Associates and Information Services Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Charles River Associates	7.93%	25.51%	9.12%
Information Services Group	3.27%	6.87%	3.14%

Summary

Charles River Associates beats Information Services Group on 13 of the 18 factors compared between the two stocks.

About Charles River Associates

CRA International, Inc., together with its subsidiaries, provides economic, financial, and management consulting services worldwide. It advises clients on economic and financial matters pertaining to litigation and regulatory proceedings; and guides corporations through business strategy and performance-related issues. The company also offers consulting services, including research and analysis, expert testimony, and support in litigation and regulatory proceedings in the areas of finance, accounting, economics, insurance, and forensic accounting and investigations to corporate clients and attorneys. In addition, it offers management consulting services comprising strategy development, performance improvement, corporate strategy and portfolio analysis, estimation of market demand, environmental, social and corporate governance and sustainability strategy and analysis, design and implementation of auction and bidding, new product pricing strategies, survey and market research, valuation of intellectual property and other assets, assessment of competitors’ actions, and analysis of new sources of supply. The company serves various industries, including communications and media; consumer, health, and wellness products; energy; entertainment and leisure; financial services; healthcare; life sciences; manufacturing and industries; natural resources; retail and distribution; technology; and transportation. CRA International, Inc. was incorporated in 1965 and is headquartered in Boston, Massachusetts.

About Information Services Group

Information Services Group, Inc., together with its subsidiaries, operates as a technology research and advisory company in the Americas, Europe, and the Asia Pacific. The company offers digital transformation services, including automation, cloud, and data analytics; sourcing advisory; managed governance and risk; network carrier; technology strategy and operations design; change management; and market intelligence and technology research and analysis services. It supports private and public sector organizations to transform and optimize their operational environments. The company also provides ISG Digital, a client solution platform that helps clients developing technology, transformation, sourcing, and digital solutions; and ISG Enterprise, a client solution platform that helps clients manage change and optimize operations in areas comprising finance, human resource, and Procure2Pay. In addition, it offers ISG GovernX to automate the management of third-party supplier relationships that comprise contract and project lifecycles, and risk management; ISG Generative AI; ISG Network Select to streamline and simplify how enterprises build their network solutions; HR technology and transformations; providers-as-a-business services; ISG Digital Engineering; ISG Research; and training-as-a-service. The company serves private sector clients operating in the manufacturing, banking and financial services, insurance, health sciences, energy and utilities, and consumer services industries; and public sector clients, including state and local governments, airport and transit authorities, and national and provincial government units. Information Services Group, Inc. was founded in 2006 and is based in Stamford, Connecticut.