Reviewing Concentrix (NASDAQ:CNXC) & Paylocity (NASDAQ:PCTY)

Paylocity (NASDAQ:PCTY) and Concentrix (NASDAQ:CNXC) are both industrials companies, but which is the better business? We will compare the two businesses based on the strength of their valuation, risk, analyst recommendations, earnings, dividends, institutional ownership and profitability.

Profitability

This table compares Paylocity and Concentrix’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Paylocity	15.23%	27.02%	5.78%
Concentrix	-13.16%	19.82%	5.62%

Valuation and Earnings

This table compares Paylocity and Concentrix”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Paylocity	$1.77 billion	4.73	$269.74 million	$4.95	31.91
Concentrix	$9.83 billion	0.18	-$1.28 billion	($21.32)	-1.38

Paylocity has higher earnings, but lower revenue than Concentrix. Concentrix is trading at a lower price-to-earnings ratio than Paylocity, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Paylocity has a beta of 0.48, meaning that its stock price is 52% less volatile than the S&P 500. Comparatively, Concentrix has a beta of 0.45, meaning that its stock price is 55% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings for Paylocity and Concentrix, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Paylocity	0	5	12	0	2.71
Concentrix	2	1	3	0	2.17

Paylocity presently has a consensus target price of $160.53, indicating a potential upside of 1.65%. Concentrix has a consensus target price of $32.75, indicating a potential upside of 11.47%. Given Concentrix’s higher probable upside, analysts clearly believe Concentrix is more favorable than Paylocity.

Institutional & Insider Ownership

94.8% of Paylocity shares are owned by institutional investors. Comparatively, 90.3% of Concentrix shares are owned by institutional investors. 19.4% of Paylocity shares are owned by insiders. Comparatively, 0.9% of Concentrix shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Summary

Paylocity beats Concentrix on 12 of the 14 factors compared between the two stocks.

About Paylocity

Paylocity Holding Corporation engages in the provision of cloud-based human capital management and payroll software solutions for workforce in the United States. The company offers payroll software solution for global payroll, expense management, tax services, on demand payment, and garnishment managed services; and time and labor management software for time and attendance, scheduling, and time collection. It also provides human resources (HR) software solutions for employee self-service, compliance, HR edge, data analytics, and workflows and documents, as well as human resource management system; talent management system for recruiting, onboarding, performance, compensation, and learning; and benefits administration software. In addition, the company offers employee experience platform for community, employee voice, recognition and rewards, video, and modern workforce index; HR reporting software; and mobile HR solutions. Further, it provides implementation and training, client, and tax and regulatory services. The company serves for-profit and non-profit organizations across industries, including business services, financial services, healthcare, manufacturing, restaurants, retail, technology, and others. It sells its products through sales representatives. The company was founded in 1997 and is headquartered in Schaumburg, Illinois.

About Concentrix

Concentrix Corporation engages in the provision of technology-infused customer experience (CX) solutions worldwide. The company provides CX process optimization, technology innovation, front- and back-office automation, analytics, and business transformation services, across various channels of communication, such as voice, chat, email, social media, asynchronous messaging, and custom applications. It also offers customer lifecycle management; customer experience/user experience strategy and design; analytics and actionable insights; digital transformation services that design and engineer CX solutions to enable efficient customer self-service and build customer loyalty; customer engagement solutions and services that address the entirety of the customer lifecycle; AI technology that can intelligently act on customer intent to improve customer experience with non-human engagement; voice of the customer and analytics solutions to gather and analyze customer feedback to foster loyalty to, and growth with, clients; analytics and consulting solutions that synthesize data and provide professional insight to improve clients’ customer experience strategies; vertical business process outsourcing (BPO) services; and back office BPO services that support clients in non-customer facing areas. The company’s clients include technology and consumer electronics, retail, travel and e-commerce, communications and media, banking, financial services and insurance, healthcare, and others, as well as global IPOs, social brands, and banks. Concentrix Corporation was founded in 2004 and is based in Newark, California.