Reviewing Aspen Technology (AZPN) & The Competition

Aspen Technology (NASDAQ: AZPN) is one of 196 publicly-traded companies in the “IT Services & Consulting” industry, but how does it contrast to its competitors? We will compare Aspen Technology to related businesses based on the strength of its dividends, earnings, profitability, valuation, analyst recommendations, institutional ownership and risk.

Profitability

This table compares Aspen Technology and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Aspen Technology 33.58% -73.17% 61.84%
Aspen Technology Competitors -20.83% -51.89% -4.31%

Analyst Recommendations

This is a summary of recent ratings and target prices for Aspen Technology and its competitors, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Aspen Technology 0 4 3 0 2.43
Aspen Technology Competitors 679 4426 7442 166 2.56

Aspen Technology currently has a consensus target price of $60.71, suggesting a potential downside of 7.32%. As a group, “IT Services & Consulting” companies have a potential downside of 0.32%. Given Aspen Technology’s competitors stronger consensus rating and higher probable upside, analysts clearly believe Aspen Technology has less favorable growth aspects than its competitors.

Risk & Volatility

Aspen Technology has a beta of 1.24, indicating that its stock price is 24% more volatile than the S&P 500. Comparatively, Aspen Technology’s competitors have a beta of 1.27, indicating that their average stock price is 27% more volatile than the S&P 500.

Institutional & Insider Ownership

62.5% of shares of all “IT Services & Consulting” companies are owned by institutional investors. 0.6% of Aspen Technology shares are owned by insiders. Comparatively, 16.2% of shares of all “IT Services & Consulting” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Aspen Technology and its competitors revenue, earnings per share and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Aspen Technology $482.94 million $218.97 million 30.90
Aspen Technology Competitors $2.12 billion $367.64 million 16.74

Aspen Technology’s competitors have higher revenue and earnings than Aspen Technology. Aspen Technology is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Summary

Aspen Technology competitors beat Aspen Technology on 10 of the 13 factors compared.

About Aspen Technology

Aspen Technology, Inc. is a global provider of process optimization software solutions designed to manage and optimize plant and process design, operational performance, and supply chain planning. The Company’s aspenONE software and related services have been developed specifically for companies in the process industries, including the energy, chemicals, and engineering and construction industries. It operates through two segments, including subscription and software, which provides licensing of process optimization software solutions and associated support services, and services, which includes professional services and training. It has developed applications to design and optimize processes across the business areas, including engineering, manufacturing and supply chain. Its products include Aspen HYSYS, Aspen Economic Evaluation, Aspen Info Plus.21, Aspen PIMS Advanced Optimization, Aspen Collaborative Demand Manager and Aspen Supply Planner.

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