Critical Contrast: DXC Technology (NYSE:DXC) and Dynatrace (NYSE:DT)

DXC Technology (NYSE:DXC) and Dynatrace (NYSE:DT) are both computer and technology companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, profitability, institutional ownership, risk, dividends, valuation and earnings.

Earnings and Valuation

This table compares DXC Technology and Dynatrace”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DXC Technology	$12.87 billion	0.17	$389.00 million	$2.33	5.48
Dynatrace	$1.70 billion	6.58	$483.68 million	$0.61	61.46

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

Analyst Recommendations

This is a breakdown of current ratings and price targets for DXC Technology and Dynatrace, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DXC Technology	3	8	0	0	1.73
Dynatrace	0	6	19	0	2.76

DXC Technology presently has a consensus price target of $14.63, suggesting a potential upside of 14.61%. Dynatrace has a consensus price target of $53.48, suggesting a potential upside of 42.66%. Given Dynatrace’s stronger consensus rating and higher probable upside, analysts plainly believe Dynatrace is more favorable than DXC Technology.

Institutional and Insider Ownership

96.2% of DXC Technology shares are owned by institutional investors. Comparatively, 94.3% of Dynatrace shares are owned by institutional investors. 0.6% of DXC Technology shares are owned by company insiders. Comparatively, 0.6% of Dynatrace shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Volatility & Risk

DXC Technology has a beta of 1, meaning that its stock price has a similar volatility profile to the S&P 500.Comparatively, Dynatrace has a beta of 0.79, meaning that its stock price is 21% less volatile than the S&P 500.

Profitability

This table compares DXC Technology and Dynatrace’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
DXC Technology	3.34%	17.56%	4.49%
Dynatrace	9.55%	9.75%	6.45%

Summary

Dynatrace beats DXC Technology on 8 of the 14 factors compared between the two stocks.

About DXC Technology

DXC Technology Company, together with its subsidiaries, provides information technology services and solutions in the United States, the United Kingdom, rest of Europe, Australia, and internationally. It operates in two segments, Global Business Services (GBS) and Global Infrastructure Services (GIS). The GBS segment offers a portfolio of analytics services and extensive partner ecosystem that help its customers to gain insights, automate operations, and accelerate their transformation journeys; and software engineering, consulting, and data analytics solutions, which enable businesses to run and manage their mission-critical functions, transform their operations, and develop new ways of doing business. This segment also simplifies, modernize, and accelerate mission-critical applications that support business agility and growth through applications services; provides proprietary modular insurance software and platforms; and operates a wide spectrum of insurance business process services, as well as helps to operate and improve bank cards, payment and lending process and operations, and customer experiences. The GIS segment offers security services, such as IT security, operations and culture for migrating to the cloud, protecting data with a zero-trust strategy, and manage a security operation center; and cloud infrastructure and IT outsourcing services. This segment also delivers a consumer-like experience, centralize IT management, and support services, as well as improves the total cost of ownership; and orchestrates hybrid cloud and multicloud environments. The company markets and sells its products through direct sales force to commercial businesses and public sector enterprises. DXC Technology Company was founded in 1959 and is headquartered in Ashburn, Virginia.

About Dynatrace

Dynatrace, Inc. provides a security platform for multicloud environments in North America, Europe, the Middle East, Africa, the Asia Pacific, and Latin America. The company operates Dynatrace, a security platform, which provides application and microservices monitoring, runtime application security, infrastructure monitoring, log management and analytics, digital experience monitoring, digital business analytics, and cloud automation. Its platform allows its customers to modernize and automate IT operations, delivers software, and enhance user experiences. In addition, the company offers implementation, consulting, and training services. It markets its products through a combination of direct sales team and a network of partners, including resellers, system integrators, and managed service providers. It serves customers in various industries comprising banking, financial services, government, insurance, retail and wholesale, transportation, and software. Dynatrace, Inc. was founded in 2005 and is headquartered in Waltham, Massachusetts.