Analyzing Verisk Analytics (NASDAQ:VRSK) and Recruit (OTCMKTS:RCRUY)

Verisk Analytics (NASDAQ:VRSK) and Recruit (OTCMKTS:RCRUY) are both large-cap business services companies, but which is the better stock? We will contrast the two companies based on the strength of their valuation, analyst recommendations, profitability, dividends, institutional ownership, risk and earnings.

Analyst Ratings

This is a summary of current ratings and recommmendations for Verisk Analytics and Recruit, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Verisk Analytics	1	5	5	0	2.36
Recruit	0	0	1	0	3.00

Verisk Analytics presently has a consensus target price of $308.09, suggesting a potential upside of 23.84%. Given Verisk Analytics’ higher probable upside, equities research analysts plainly believe Verisk Analytics is more favorable than Recruit.

Valuation and Earnings

This table compares Verisk Analytics and Recruit”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Verisk Analytics	$2.88 billion	12.06	$958.20 million	$6.49	38.33
Recruit	$23.36 billion	3.58	$2.70 billion	$0.85	12.60

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

Profitability

This table compares Verisk Analytics and Recruit’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Verisk Analytics	30.67%	460.89%	20.80%
Recruit	12.00%	26.14%	15.57%

Institutional and Insider Ownership

90.0% of Verisk Analytics shares are owned by institutional investors. 0.5% of Verisk Analytics shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Dividends

Verisk Analytics pays an annual dividend of $1.80 per share and has a dividend yield of 0.7%. Recruit pays an annual dividend of $0.02 per share and has a dividend yield of 0.2%. Verisk Analytics pays out 27.7% of its earnings in the form of a dividend. Recruit pays out 2.4% 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. Verisk Analytics has increased its dividend for 6 consecutive years. Verisk Analytics is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk & Volatility

Verisk Analytics has a beta of 0.86, meaning that its share price is 14% less volatile than the S&P 500. Comparatively, Recruit has a beta of 1.58, meaning that its share price is 58% more volatile than the S&P 500.

Summary

Verisk Analytics beats Recruit on 12 of the 17 factors compared between the two stocks.

About Verisk Analytics

Verisk Analytics, Inc. provides data analytics and technology solutions to the insurance markets in the United States and internationally. It offers policy language, prospective loss costs, policy writing and rating rules, and various underwriting solutions for risk selection and segmentation, pricing, and workflow optimization; property- and auto- specific rating and underwriting information solutions that allows clients to understand, quantify, underwrite, mitigate, and avoid potential loss for risks; catastrophe modeling solutions, which enables companies to identify, quantify, and plan for the financial consequences of catastrophes for use by insurers, reinsurers, intermediaries, financial institutions, and governments. The company also provides life insurance solutions for transforming current workflows in life insurance underwriting, claim insights, policy administration, unclaimed property/equity, compliance and fraud detection, and actuarial and portfolio modeling; Marketing Solutions, such as compliant, real-time decisioning, profitability, and risk assessment for inbound consumer interactions; and international underwriting and claims solutions. In addition, it offers claims insurance solutions, which provides analytics in fraud detection, compliance reporting, subrogation liability assessment, litigation, and repair cost estimation and valuation solutions; and casualty solutions, such as compliance, casualty claims decision support, and workflow automation solutions. Further, the company supplies software to the specialty insurance market. The company was founded in 1971 and is headquartered in Jersey City, New Jersey.

About Recruit

Recruit Holdings Co., Ltd. provides HR technology and business solutions that transforms the world of work. It operates through three segments: HR Technology, Matching & Solutions, and Staffing. The HR Technology segment provides various technological solutions that help job seekers and employers in navigating hiring and recruitment. The Matching & Solutions segment offers HR solutions that support business clients’ recruiting and hiring activities and individual users’ job search activities through its job advertising services and placement services. This segment also provides marketing solutions that provide matching platforms for businesses in various industries, including housing and real estate, beauty, bridal, travel, dining, and others, as well as SaaS solutions, which are business and management support tools for small and medium-sized companies. The Staffing segment provides temporary staffing services in Japan, Europe, the United States, and Australia. Recruit Holdings Co., Ltd. operates in more than 60 countries. The company was formerly known as Recruit Co., Ltd. and changed its name to Recruit Holdings Co., Ltd. in October 2012. Recruit Holdings Co., Ltd. was founded in 1960 and is headquartered in Tokyo, Japan.