Analyzing DXC Technology (NYSE:DXC) and Fujitsu (OTCMKTS:FJTSY)

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

Analyst Ratings

This is a summary of recent ratings and price targets for DXC Technology and Fujitsu, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DXC Technology	3	6	0	1	1.90
Fujitsu	0	1	0	0	2.00

DXC Technology currently has a consensus target price of $14.71, indicating a potential upside of 20.81%. Given DXC Technology’s higher probable upside, equities research analysts plainly believe DXC Technology is more favorable than Fujitsu.

Volatility and Risk

DXC Technology has a beta of 1.07, suggesting that its stock price is 7% more volatile than the S&P 500. Comparatively, Fujitsu has a beta of 0.84, suggesting that its stock price is 16% less volatile than the S&P 500.

Dividends

DXC Technology pays an annual dividend of $0.84 per share and has a dividend yield of 6.9%. Fujitsu pays an annual dividend of $0.11 per share and has a dividend yield of 0.5%. DXC Technology pays out 36.1% of its earnings in the form of a dividend. Fujitsu pays out 24.4% 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.

Profitability

This table compares DXC Technology and Fujitsu’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%
Fujitsu	N/A	N/A	N/A

Institutional & Insider Ownership

96.2% of DXC Technology shares are held by institutional investors. Comparatively, 0.1% of Fujitsu shares are held by institutional investors. 0.6% of DXC Technology shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares DXC Technology and Fujitsu”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DXC Technology	$12.68 billion	0.16	$389.00 million	$2.33	5.23
Fujitsu	$23.31 billion	1.80	$1.45 billion	$0.45	49.58

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

Summary

DXC Technology beats Fujitsu on 10 of the 16 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 Fujitsu

Fujitsu Limited operates as an information and communication technology company in Japan and internationally. The company operates through three segments: Technology Solutions, Ubiquitous Solutions, and Device Solutions. The company offers multi cloud and hybrid IT services; assessment and consultative services; SAP landscape transformation services; new workplace; datacentre products comprising integrated systems, storage solutions, servers, network switches, and infrastructure management; workplace products including notebooks, tablet PC’s, desktop PC’s, workstations, thin clients, displays, and peripheral devices; consumption based IT services; installation and implementation services; and hardware, software, and infrastructure support services, as well as electronic devices, air conditioning products, and network solutions. It also provides cyber security solutions, including cyber security consulting, managed security servies, and security operation and advanced threat centers; internet of things, artificial intelligence platform and solutions; and software products comprising FUJITSU Software Infrastructure Manager and FUJITSU Software ServerView Suite. Further, the company offers electronic components, such as semiconductor packages and batteries. It serves automotive, manufacturing, retail, financial services, transport, telecommunications, healthcare, and energy and utilities industries; the public sectors; and services providers. The company was founded in 1923 and is headquartered in Tokyo, Japan.