Analyzing UL Solutions (NYSE:ULS) & BGSF (NYSE:BGSF)

BGSF (NYSE:BGSF) and UL Solutions (NYSE:ULS) are both business services companies, but which is the better business? We will compare the two companies based on the strength of their valuation, earnings, dividends, analyst recommendations, risk, profitability and institutional ownership.

Profitability

This table compares BGSF and UL Solutions’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
BGSF	-8.43%	-15.34%	-8.96%
UL Solutions	10.61%	31.62%	12.55%

Analyst Recommendations

This is a breakdown of current ratings and target prices for BGSF and UL Solutions, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
BGSF	1	1	0	1	2.33
UL Solutions	0	6	4	1	2.55

UL Solutions has a consensus price target of $88.42, suggesting a potential downside of 3.52%. Given UL Solutions’ stronger consensus rating and higher possible upside, analysts plainly believe UL Solutions is more favorable than BGSF.

Valuation and Earnings

This table compares BGSF and UL Solutions”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
BGSF	$93.31 million	0.67	-$11.43 million	($1.03)	-5.43
UL Solutions	$3.05 billion	6.04	$325.00 million	$1.59	57.64

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

Volatility & Risk

BGSF has a beta of 0.53, indicating that its share price is 47% less volatile than the S&P 500. Comparatively, UL Solutions has a beta of 0.59, indicating that its share price is 41% less volatile than the S&P 500.

Insider & Institutional Ownership

37.2% of BGSF shares are owned by institutional investors. 8.0% of BGSF shares are owned by company insiders. Comparatively, 1.2% of UL Solutions shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

UL Solutions beats BGSF on 12 of the 14 factors compared between the two stocks.

About BGSF

BGSF, Inc., together with its subsidiaries, provides consulting, managed services, and professional workforce solutions in the United States. It operates in two segments, Property Management and Professional. The Property Management segment offers office and maintenance field talent to various apartment communities and commercial buildings. The Professional segment provides skilled IT professionals in SAP, Workday, Peoplesoft, Hyperion, Oracle, One Stream, cyber, project management, management services, and other IT workforce solutions. This segment also offers finance, accounting, legal, human resource, and related support personnel. It serves its products to fortune 500 companies, and medium and small companies, as well as consulting companies. The company was formerly known as BG Staffing, Inc. and changed its name to BGSF, Inc. in February 2021. BGSF, Inc. was incorporated in 2007 and is based in Plano, Texas.

About UL Solutions

UL Solutions Inc. provides safety science services worldwide. It operates through three segments: Industrial, Consumer, and Software and Advisory. The Industrial segment provides testing, inspection, and certification services across various end markets, including energy, industrial automation, engineered materials, and built environment, as well as stakeholders, such as manufacturers, building owners, end users, and regulators. The Consumer segment offers safety certification testing, ongoing certification, global market access, testing for connectivity, performance and quality, and critical systems advisory and training services, as well as product market acceptance and risk mitigation services for customers in the consumer products end markets comprising consumer electronics, medical devices, information technologies, appliances, HVAC, lighting, and retail, as well as consumer applications, such as new mobility, smart products, and 5G. The Software and Advisory segment provide software and technical advisory services that enable customers to manage regulatory requirements, deliver supply chain transparency, and operationalize sustainability for regulated industries, including life sciences, supply chain regulations, transparency needs, and new ESG and sustainability requirements. It offers ULTRUS software brand to help customers improve speed to market, sustainability and safety. UL Solutions Inc. was formerly known as UL Inc. and changed its name to UL Solutions Inc. in June 2022. The company was founded in 1894 and is headquartered in Northbrook, Illinois with additional offices in North America, Asia Pacific, Africa, Europe, Latin America, and Middle East. UL Solutions Inc. operates as a subsidiary of ULSE Inc.