Amadeus IT Group (OTCMKTS:AMADY) vs. Grid Dynamics (NASDAQ:GDYN) Critical Review

Grid Dynamics (NASDAQ:GDYN) and Amadeus IT Group (OTCMKTS:AMADY) are both technology companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, profitability, valuation, institutional ownership, dividends, risk and analyst recommendations.

Institutional & Insider Ownership

71.2% of Grid Dynamics shares are owned by institutional investors. 6.5% of Grid Dynamics 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.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Grid Dynamics and Amadeus IT Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Grid Dynamics	2	2	4	0	2.25
Amadeus IT Group	2	1	4	0	2.29

Grid Dynamics presently has a consensus price target of $11.80, suggesting a potential downside of 9.92%. Given Grid Dynamics’ higher probable upside, analysts plainly believe Grid Dynamics is more favorable than Amadeus IT Group.

Earnings and Valuation

This table compares Grid Dynamics and Amadeus IT Group”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Grid Dynamics	$411.83 million	2.58	$9.67 million	$0.09	145.56
Amadeus IT Group	$7.37 billion	3.93	$1.51 billion	$3.53	19.01

Amadeus IT Group has higher revenue and earnings than Grid Dynamics. Amadeus IT Group is trading at a lower price-to-earnings ratio than Grid Dynamics, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Grid Dynamics has a beta of 0.88, suggesting that its share price is 12% less volatile than the S&P 500. Comparatively, Amadeus IT Group has a beta of 0.92, suggesting that its share price is 8% less volatile than the S&P 500.

Profitability

This table compares Grid Dynamics and Amadeus IT Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Grid Dynamics	1.81%	3.24%	2.83%
Amadeus IT Group	19.86%	29.84%	12.46%

Summary

Amadeus IT Group beats Grid Dynamics on 9 of the 13 factors compared between the two stocks.

About Grid Dynamics

Grid Dynamics Holdings, Inc., together with its subsidiaries, provides technology consulting, platform and product engineering, and analytics services in North America, Europe, and internationally. It offers cloud platform and product engineering services, such as architecting, designing, and building scalable and secure cloud-based platforms and business applications; and AI/machine learning and data platform engineering services that build platforms to facilitate batch and streaming data ingestion, quality governance, orchestration, semantic modeling, observability, and analysis at scale. The company provides digital engagement services, including digital ecosystem design and implementation; and supply chain, Internet of Thing, and advanced manufacturing, which focuses on transforming traditional operations into smart and connected ecosystems. It serves customers that operate in the tech, media, telecommunications, retail, consumer packaged goods, manufacturing, and finance industries. The company was formerly known as ChaSerg Technology Acquisition Corp. and changed its name to Grid Dynamics Holdings, Inc. Grid Dynamics Holdings, Inc. was founded in 2006 and is headquartered in San Ramon, California.

About Amadeus IT Group

Amadeus IT Group, S.A., together with its subsidiaries, operates as a transaction processor for the travel and tourism industry worldwide. The company operates through three segments: Air Distribution, Air IT Solutions, and Hospitality & Other Solutions. The company acts as an international network providing real-time search, pricing, booking, and ticketing services, and other processing solutions through Amadeus GDS, Altéa PSS, and New Skies platforms. It also offers travel providers a portfolio of technology solutions, which automate certain mission-critical business processes, such as reservations, inventory management, and departure control. In addition, the company is involved in the provision of software development and definition, software distribution, regional support, data processing, intermediation, computer consulting, installation of industrial machinery and equipment, consultancy and technology development services for payments, and information technology services; financial activities; and e-commerce business. It serves providers of travel products and services, such as airlines, airports, hotels, tour operators, insurance companies, land and sea transport companies, travel sellers and brokers, and travel buyers. The company was formerly known as Amadeus IT Holding, S.A. and changed its name to Amadeus IT Group, S.A. in August 2016. Amadeus IT Group, S.A. was founded in 1987 and is headquartered in Madrid, Spain.