Critical Comparison: Computer Services (OTCMKTS:CSVI) vs. RingCentral (OTCMKTS:RNG)

RingCentral (NYSE:RNG) and Computer Services (OTCMKTS:CSVI) are both computer and technology companies, but which is the superior stock? We will contrast the two businesses based on the strength of their risk, earnings, valuation, institutional ownership, analyst recommendations, dividends and profitability.

Valuation and Earnings

This table compares RingCentral and Computer Services’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
RingCentral $673.62 million 15.28 -$26.20 million ($0.04) -3,101.50
Computer Services $266.49 million 4.68 $44.96 million N/A N/A

Computer Services has lower revenue, but higher earnings than RingCentral.

Profitability

This table compares RingCentral and Computer Services’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
RingCentral -3.95% -1.13% -0.40%
Computer Services 17.52% 19.71% 14.35%

Dividends

Computer Services pays an annual dividend of $0.84 per share and has a dividend yield of 1.9%. RingCentral does not pay a dividend.

Institutional and Insider Ownership

83.4% of RingCentral shares are held by institutional investors. Comparatively, 0.5% of Computer Services shares are held by institutional investors. 11.0% of RingCentral shares are held 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.

Analyst Recommendations

This is a summary of current ratings and recommmendations for RingCentral and Computer Services, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
RingCentral 0 2 12 1 2.93
Computer Services 0 0 0 0 N/A

RingCentral currently has a consensus target price of $136.40, indicating a potential upside of 9.95%. Given RingCentral’s higher possible upside, equities analysts clearly believe RingCentral is more favorable than Computer Services.

Volatility & Risk

RingCentral has a beta of 0.87, indicating that its share price is 13% less volatile than the S&P 500. Comparatively, Computer Services has a beta of 0.3, indicating that its share price is 70% less volatile than the S&P 500.

Summary

RingCentral beats Computer Services on 8 of the 14 factors compared between the two stocks.

About RingCentral

RingCentral, Inc. provides software-as-a-service solutions that enable businesses to communicate, collaborate, and connect primarily in North America. The company's products include RingCentral Office, provides communication and collaboration across various modes, including high-definition voice, video, SMS, messaging and collaboration, conferencing, online meetings, and fax through smartphones, tablets, PCs, and desk phones; RingCentral Professional, a cloud based virtual telephone service for professionals, as well as provides inbound call answering and management services, and includes inbound local, long-distance, and toll-free minutes; and RingCentral Fax that provides online fax capabilities that allow businesses to send and receive fax documents without a fax machine. Its products also comprise RingCentral Contact Center, a collaborative contact center solution that delivers omni-channel; and RingCentral Glip, a team messaging and collaboration solution that allows a range of teams to stay connected through various modes of communication through an integration with RingCentral Office. The company serves a range of industries, including financial services, healthcare, legal services, real estate, retail, technology, insurance, construction, hospitality, and state and local government, as well as others. It sells its products through a network of direct sales representatives, as well as sales agents and channel partners. The company was incorporated in 1999 and is headquartered in Belmont, California.

About Computer Services

Computer Services, Inc., together with its subsidiaries, delivers core processing, digital banking, managed services, payments processing, print and electronic distribution, and regulatory compliance solutions to financial institutions and corporate entities in the United States. It provides processing, maintenance, and support services; software licensing and installation services; professional services; and e-business services, as well as equipment and supply sales. The company also offers integrated banking solutions, which include mobile and Internet banking; check imaging; cash management; branch and merchant capture; print and mail, and online document delivery services; corporate intranets; secure Web hosting; e-messaging; teller and platform services; ATM and debit card service and support; payments solutions; risk assessment; network management; cloud-based managed services; and compliance software and services for regulatory compliance, homeland security, anti-money laundering, anti-terrorism financing, and fraud prevention. It provides its products and services to community banks, regional banks, and multi-bank holding companies, as well as to various other business enterprises. Computer Services, Inc. was incorporated in 1965 and is headquartered in Paducah, Kentucky.

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