Akamai Technologies (NASDAQ:AKAM) and Total System Services (NYSE:TSS) are both large-cap computer and technology companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, earnings, valuation, dividends, profitability, risk and analyst recommendations.
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Total System Services pays an annual dividend of $0.52 per share and has a dividend yield of 0.6%. Akamai Technologies does not pay a dividend. Total System Services pays out 12.2% of its earnings in the form of a dividend. Total System Services has increased its dividend for 2 consecutive years.
Volatility & Risk
Akamai Technologies has a beta of 0.69, suggesting that its share price is 31% less volatile than the S&P 500. Comparatively, Total System Services has a beta of 1.09, suggesting that its share price is 9% more volatile than the S&P 500.
This table compares Akamai Technologies and Total System Services’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Total System Services||14.31%||30.94%||10.46%|
Earnings and Valuation
This table compares Akamai Technologies and Total System Services’ revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Akamai Technologies||$2.71 billion||4.34||$298.37 million||$2.76||26.15|
|Total System Services||$4.03 billion||4.12||$576.65 million||$4.26||22.00|
Total System Services has higher revenue and earnings than Akamai Technologies. Total System Services is trading at a lower price-to-earnings ratio than Akamai Technologies, indicating that it is currently the more affordable of the two stocks.
This is a summary of current recommendations for Akamai Technologies and Total System Services, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Total System Services||0||6||11||0||2.65|
Akamai Technologies currently has a consensus price target of $81.80, suggesting a potential upside of 13.33%. Total System Services has a consensus price target of $99.07, suggesting a potential upside of 5.73%. Given Akamai Technologies’ stronger consensus rating and higher probable upside, analysts plainly believe Akamai Technologies is more favorable than Total System Services.
Institutional and Insider Ownership
87.0% of Akamai Technologies shares are owned by institutional investors. Comparatively, 76.6% of Total System Services shares are owned by institutional investors. 3.2% of Akamai Technologies shares are owned by company insiders. Comparatively, 2.4% of Total System Services shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Total System Services beats Akamai Technologies on 10 of the 17 factors compared between the two stocks.
About Akamai Technologies
Akamai Technologies, Inc. provides cloud services for delivering, optimizing, and securing content and business applications over the Internet in the United States and internationally. It provides cloud security solutions, including Web Application Protector to safeguard Web assets from Web application and distributed denial of service; Kona Site Defender, a cloud security solution; Bot Manager to identify bots and categorize bots based on business or IT impact; Fast DNS, which translates human-readable domain names into numerical IP addresses; Prolexic Routed to protect Web- and IP-based applications; and Client Reputation that assigns risk scores to malicious IP address and enables customers to take action on individual clients. The company also offers enterprise security solutions, including Enterprise Application Access that enables remote access to applications; and Enterprise Threat Protector to enable enterprise security teams to identify, block, and mitigate targeted attacks. In addition, the company provides Web and mobile performance solutions, such as Ion, a suite of intelligent performance optimization tools and controls; Dynamic Site Accelerator to accelerate and secure interactive Websites; Image Manager that automatically optimizes online images; CloudTest to conduct load testing and other analysis of Websites in a pre-production environment; and mPulse that provides real-time Website performance data to provide insight about end-user experiences on a Website. Further, it provides carrier solutions, including Aura Managed CDN, intelligent recursive DNS platforms, and security and personalization services; and media delivery solutions, such as adaptive delivery, download delivery, media services live, and media analytics, as well as NetStorage, a cloud storage solution. The company sells its solutions through direct sales and service organization; and channel partners. The company was founded in 1998 and is headquartered in Cambridge, Massachusetts.
About Total System Services
Total System Services, Inc. provides payment processing, merchant, and related payment services to financial and nonfinancial institutions worldwide. The company operates through three segments: Issuer Solutions, Merchant Solutions, and Consumer Solutions. It offers general purpose reloadable prepaid and payroll cards, demand deposit accounts, and other financial service solutions to the underbanked and other consumers and businesses. The company also provides third party processing and related services for credit card issuers, merchant acquirers, independent sales organizations, and financial institutions; and issuer processing services, as well as operates as a prepaid program manager. Total System Services, Inc. was founded in 1982 and is headquartered in Columbus, Georgia.