Comparing Korn/Ferry International (NYSE:KFY) & Exponent (NASDAQ:EXPO)

Exponent (NASDAQ:EXPO) and Korn/Ferry International (NYSE:KFY) are both mid-cap industrials companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, risk, valuation, analyst recommendations, profitability, institutional ownership and earnings.

Earnings & Valuation

This table compares Exponent and Korn/Ferry International”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Exponent	$582.01 million	5.34	$106.01 million	$2.23	29.33
Korn/Ferry International	$2.94 billion	1.38	$277.43 million	$5.30	13.97

Korn/Ferry International has higher revenue and earnings than Exponent. Korn/Ferry International is trading at a lower price-to-earnings ratio than Exponent, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Exponent and Korn/Ferry International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Exponent	17.67%	31.48%	15.53%
Korn/Ferry International	9.36%	14.43%	7.36%

Dividends

Exponent pays an annual dividend of $1.24 per share and has a dividend yield of 1.9%. Korn/Ferry International pays an annual dividend of $2.20 per share and has a dividend yield of 3.0%. Exponent pays out 55.6% of its earnings in the form of a dividend. Korn/Ferry International pays out 41.5% 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. Exponent has increased its dividend for 12 consecutive years and Korn/Ferry International has increased its dividend for 5 consecutive years. Korn/Ferry International is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider and Institutional Ownership

92.4% of Exponent shares are held by institutional investors. Comparatively, 98.8% of Korn/Ferry International shares are held by institutional investors. 1.7% of Exponent shares are held by insiders. Comparatively, 1.0% of Korn/Ferry International shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Exponent and Korn/Ferry International, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Exponent	0	2	2	0	2.50
Korn/Ferry International	0	1	4	0	2.80

Exponent presently has a consensus target price of $81.00, indicating a potential upside of 23.83%. Korn/Ferry International has a consensus target price of $80.25, indicating a potential upside of 8.35%. Given Exponent’s higher possible upside, equities research analysts plainly believe Exponent is more favorable than Korn/Ferry International.

Volatility & Risk

Exponent has a beta of 0.68, suggesting that its share price is 32% less volatile than the S&P 500. Comparatively, Korn/Ferry International has a beta of 1.19, suggesting that its share price is 19% more volatile than the S&P 500.

Summary

Korn/Ferry International beats Exponent on 9 of the 17 factors compared between the two stocks.

About Exponent

Exponent, Inc., together with its subsidiaries, operates as a science and engineering consulting company in the United States and internationally. The company operates in two segments, Engineering and Other Scientific, and Environmental and Health. The Engineering and Other Scientific segment provides services in the areas of biomechanics, biomedical engineering and sciences, buildings and structures, civil engineering, construction consulting, data sciences, electrical engineering and computer science, human factors, materials and corrosion engineering, mechanical engineering, polymer science and materials chemistry, thermal sciences, and vehicle engineering. The Environmental and Health segment offers services in the areas of chemical regulation and food safety, ecological and biological sciences, environmental and earth sciences, and health sciences. The company offers approximately 90 technical disciplines to solve pressing and complicated challenges facing stakeholders. It serves clients in chemical, construction, consumer products, energy, food, beverage and nutrition, government, life sciences, insurance, manufacturing, technology, industrial equipment, transportation, and other sectors of the economy. The company was formerly known as The Failure Group, Inc. and changed its name to Exponent, Inc. in 1998. The company was founded in 1967 and is headquartered in Menlo Park, California.

About Korn/Ferry International

Korn Ferry, together with its subsidiaries, provides organizational consulting services worldwide. It operates through four segments: Consulting, Digital, Executive Search, and Recruitment Process Outsourcing (RPO) & Professional Search. The company provides executive search services to recruit board level, chief executive, other senior executive, and general management talent of organizations. It also offers organizational strategy, assessment and succession, leadership and professional development, and total reward services. In addition, the company provides RPO, business project, professional search, and outsource recruiting solutions. Further, the company offers tech-enabled solutions that identify structures, roles, capabilities, and behaviors to drive businesses. It serves public and private companies, and middle market and emerging growth companies, as well as government and non-profit organizations. The company was formerly known as Korn/Ferry International and changed its name to Korn Ferry in January 2019. Korn Ferry was founded in 1969 and is based in Los Angeles, California.