Contrasting Equifax (NYSE:EFX) & Charles River Associates (NASDAQ:CRAI)

Charles River Associates (NASDAQ:CRAI) and Equifax (NYSE:EFX) are both business services companies, but which is the superior stock? We will contrast the two businesses based on the strength of their dividends, institutional ownership, profitability, risk, earnings, analyst recommendations and valuation.

Insider and Institutional Ownership

84.1% of Charles River Associates shares are held by institutional investors. Comparatively, 96.2% of Equifax shares are held by institutional investors. 4.7% of Charles River Associates shares are held by company insiders. Comparatively, 1.4% of Equifax shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Charles River Associates and Equifax, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Charles River Associates	0	0	2	0	3.00
Equifax	0	8	12	1	2.67

Charles River Associates presently has a consensus price target of $239.00, suggesting a potential upside of 34.75%. Equifax has a consensus price target of $277.13, suggesting a potential upside of 30.24%. Given Charles River Associates’ stronger consensus rating and higher possible upside, analysts plainly believe Charles River Associates is more favorable than Equifax.

Dividends

Charles River Associates pays an annual dividend of $2.28 per share and has a dividend yield of 1.3%. Equifax pays an annual dividend of $2.00 per share and has a dividend yield of 0.9%. Charles River Associates pays out 27.4% of its earnings in the form of a dividend. Equifax pays out 38.0% 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. Charles River Associates has raised its dividend for 7 consecutive years and Equifax has raised its dividend for 1 consecutive years. Charles River Associates is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Charles River Associates and Equifax’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%
Equifax	11.08%	19.28%	8.10%

Volatility & Risk

Charles River Associates has a beta of 0.92, meaning that its share price is 8% less volatile than the S&P 500. Comparatively, Equifax has a beta of 1.64, meaning that its share price is 64% more volatile than the S&P 500.

Valuation & Earnings

This table compares Charles River Associates and Equifax”s top-line 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	1.59	$46.65 million	$8.32	21.32
Equifax	$5.94 billion	4.38	$604.10 million	$5.27	40.38

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

Equifax Inc. operates as a data, analytics, and technology company. The company operates through three segments: Workforce Solutions, U.S. Information Solutions (USIS), and International. The Workforce Solutions segment offers services that enables customers to verify income, employment, educational history, criminal justice data, healthcare professional licensure, and sanctions of people in the United States; and employer customers with services that assist them in complying with and automating payroll-related and human resource management processes throughout the entire cycle of the employment relationship. The USIS segment provides consumer and commercial information services, such as credit information and credit scoring, credit modeling and portfolio analytics, locate, fraud detection and prevention, identity verification, and other consulting services; mortgage services; financial marketing services; identity management services; and credit monitoring products. The International segment offers information service products, which include consumer and commercial services, such as credit and financial information, and credit scoring and modeling; and credit and other marketing products and services, as well as offers information, technology, and other services to support debt collections and recovery management. The company serves customers in financial services, mortgage, retail, telecommunications, utilities, automotive, brokerage, healthcare, and insurance industries, as well as government agencies. It operates in Argentina, Australia, Brazil, Canada, Chile, Costa Rica, Dominican Republic, Ecuador, El Salvador, Honduras, India, Ireland, Mexico, New Zealand, Paraguay, Peru, Portugal, Spain, the United Kingdom, Uruguay, and the United States. The company was founded in 1899 and is headquartered in Atlanta, Georgia.