Unisys (NYSE:UIS) vs. Grid Dynamics (NASDAQ:GDYN) Critical Contrast

Unisys (NYSE:UIS) and Grid Dynamics (NASDAQ:GDYN) are both small-cap computer and technology companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, valuation, institutional ownership, analyst recommendations, earnings, profitability and dividends.

Institutional & Insider Ownership

86.9% of Unisys shares are held by institutional investors. Comparatively, 71.2% of Grid Dynamics shares are held by institutional investors. 2.7% of Unisys shares are held by insiders. Comparatively, 7.2% of Grid Dynamics shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Unisys and Grid Dynamics”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Unisys	$2.01 billion	0.14	-$193.40 million	($1.18)	-3.32
Grid Dynamics	$350.57 million	2.04	$4.04 million	$0.19	44.42

Grid Dynamics has lower revenue, but higher earnings than Unisys. Unisys 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

Unisys has a beta of 1.33, suggesting that its stock price is 33% more volatile than the S&P 500. Comparatively, Grid Dynamics has a beta of 1.04, suggesting that its stock price is 4% more volatile than the S&P 500.

Profitability

This table compares Unisys and Grid Dynamics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Unisys	-4.16%	-12.55%	1.56%
Grid Dynamics	4.37%	1.89%	1.64%

Analyst Recommendations

This is a summary of recent ratings and price targets for Unisys and Grid Dynamics, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Unisys	1	2	2	0	2.20
Grid Dynamics	1	0	5	0	2.67

Unisys currently has a consensus target price of $6.38, suggesting a potential upside of 62.84%. Grid Dynamics has a consensus target price of $14.80, suggesting a potential upside of 75.36%. Given Grid Dynamics’ stronger consensus rating and higher probable upside, analysts clearly believe Grid Dynamics is more favorable than Unisys.

Summary

Grid Dynamics beats Unisys on 11 of the 14 factors compared between the two stocks.

About Unisys

Unisys Corporation, together with its subsidiaries, operates as an information technology solutions company in the United States and internationally. It operates in three segments: Digital Workplace Solutions (DWS); Cloud, Applications & Infrastructure Solutions (CA&I); and Enterprise Computing Solutions. The DWS segment provides advice and execution related to modern workplace solutions, such as communication and collaboration, intelligent workplace services, unified experience management, and modern device management; and traditional workplace solutions, including traditional service desk, device management and field services. The CA&I segment offers cloud management, hybrid infrastructure, modern applications, data and artificial intelligence, and cyber security; and design, implementation, monitoring, automation, and management of dedicated on-premises or hosted infrastructure. The Enterprise Computing Solutions segment provides license and support solutions; specialized services, next-generation computing, and industry solutions; and other solutions that provides various micro-market and business process solutions. The company also offers enterprise software and technology products, including Unisys InteliServe, PowerSuite, Unisys Logistics Optimization, CloudForte, ClearPath Forward, and Unisys Stealth. It serves its products in the travel and transportation, financial services, and healthcare industries. Unisys Corporation was founded in 1873 and is based in Blue Bell, Pennsylvania.

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.