Critical Comparison: INTERTEK GP (OTCMKTS:IKTSY) versus Morningstar (NASDAQ:MORN)

Morningstar (NASDAQ:MORN) and INTERTEK GP (OTCMKTS:IKTSY) are both mid-cap business services companies, but which is the better investment? We will contrast the two companies based on the strength of their risk, analyst recommendations, dividends, valuation, profitability, earnings and institutional ownership.

Profitability

This table compares Morningstar and INTERTEK GP’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Morningstar	17.22%	23.54%	10.52%
INTERTEK GP	N/A	N/A	N/A

Valuation & Earnings

This table compares Morningstar and INTERTEK GP”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Morningstar	$2.28 billion	4.36	$369.90 million	$9.39	25.02
INTERTEK GP	$4.34 billion	2.24	$441.39 million	N/A	N/A

INTERTEK GP has higher revenue and earnings than Morningstar.

Insider & Institutional Ownership

57.0% of Morningstar shares are owned by institutional investors. 36.2% of Morningstar shares are owned by company insiders. Comparatively, 0.3% of INTERTEK GP shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Risk & Volatility

Morningstar has a beta of 1.01, suggesting that its stock price is 1% more volatile than the S&P 500. Comparatively, INTERTEK GP has a beta of 0.78, suggesting that its stock price is 22% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings for Morningstar and INTERTEK GP, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Morningstar	0	1	2	0	2.67
INTERTEK GP	0	1	0	2	3.33

Morningstar presently has a consensus price target of $361.67, indicating a potential upside of 53.97%. Given Morningstar’s higher possible upside, research analysts plainly believe Morningstar is more favorable than INTERTEK GP.

Dividends

Morningstar pays an annual dividend of $1.82 per share and has a dividend yield of 0.8%. INTERTEK GP pays an annual dividend of $1.41 per share and has a dividend yield of 2.3%. Morningstar pays out 19.4% of its earnings in the form of a dividend. Morningstar has increased its dividend for 16 consecutive years.

Summary

Morningstar beats INTERTEK GP on 10 of the 16 factors compared between the two stocks.

About Morningstar

Morningstar, Inc. provides independent investment insights in the United States, Asia. Australia, Continental Europe, the United Kingdom, and internationally. The company operates in five segments: Morningstar Data and Analytics; PitchBook; Morningstar Wealth; Morningstar Credit; and Morningstar Retirement. The company offers managing investments, including mutual funds, ETFs, separate accounts, collective investment trusts, model portfolios, equities, and fixed income securities; Morningstar Direct is an investment-analysis and reporting platform; Morningstar Advisor Workstation, a suite of tool to provide help and advice. The PitchBook segment provides data and research covering the private capital markets comprising venture capital, private equity, private credit and bank loans, and merger and acquisition activities; and pitchbook platform. It provides model portfolios and wealth platforms; Morningstar Managed Portfolios, an advisor service with model portfolios designed for fee-based independent financial advisors; and Morningstar.com that discovers, evaluates, and monitors stocks, ETFs, and mutual funds; build and monitor portfolios and markets. In addition, the company provides credit ratings, research, data, and credit analytics solutions; Morningstar DBRS which offers securitizations and other structured finance instruments, such as asset-backed securities, residential mortgage-backed securities, commercial mortgage-backed securities, and collateralized loan obligations. Further, it offers managed retirement accounts, fiduciary services, Morningstar Lifetime Allocation funds, and custom models; Morningstar Indexes offers market indexes used for performance benchmarks and as the basis for investment products and other portfolio strategies; and Morningstar Sustainalytics provides environmental, social and governance data, research, analysis, and insights. Morningstar, Inc. was incorporated in 1984 and is headquartered in Chicago, Illinois.

About INTERTEK GP

Intertek Group plc engages in the provision of quality assurance solutions to various industries in the United Kingdom, the United States, China, Australia, and internationally. The company operates in five segments: Consumer Products, Corporate Assurance, Health and Safety, Industry and Infrastructure, and World of Energy. It offers quality assurance, testing, inspection, and certification services (ATIC), including laboratory safety, quality and performance testing, accredited third-party management systems auditing and certification, technical inspection, second-party supplier auditing and supply chain solutions, sustainability data verification, process performance analysis and training, food safety testing, hygiene and safety audits, advisory and consulting, and validation services, as well as hardware, software, and cyber security solutions. The company also provides asset performance management, analytical testing, non-destructive and materials testing, engineering, cargo and inventory inspection, analytical assessment, calibration, supply-chain traceability, and related research and technical services, as well as support services in product development, regulatory authorization, chemical testing, and production. It serves a range of industries, including textiles, footwear, toys, hardlines, home appliances, consumer electronics, information and communication technology, automotive, aerospace, lighting, building products, industrial and renewable energy products, oil and gas, petrochemical, minerals, exploration, ore and mining, building and construction, solar energy, energy storage, green hydrogen, petroleum and biofuels, agricultural supply chain, food, transportation, chemicals and pharma, and healthcare, as well as governments and regulatory bodies. The company was founded in 1885 and is based in London, the United Kingdom.