Critical Comparison: Tencent (OTCMKTS:TCEHY) versus Sify Technologies (NASDAQ:SIFY)

Tencent (OTCMKTS:TCEHY) and Sify Technologies (NASDAQ:SIFY) are both computer and technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, profitability, institutional ownership, valuation, dividends, analyst recommendations and risk.

Profitability

This table compares Tencent and Sify Technologies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Tencent	30.60%	19.52%	11.80%
Sify Technologies	-3.02%	-20.95%	-4.92%

Analyst Recommendations

This is a breakdown of recent ratings for Tencent and Sify Technologies, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Tencent	0	2	2	0	2.50
Sify Technologies	1	0	0	0	1.00

Tencent currently has a consensus target price of $106.00, indicating a potential upside of 89.05%. Given Tencent’s stronger consensus rating and higher probable upside, analysts plainly believe Tencent is more favorable than Sify Technologies.

Institutional and Insider Ownership

0.0% of Tencent shares are owned by institutional investors. Comparatively, 0.6% of Sify Technologies shares are owned by institutional investors. 77.0% of Sify Technologies shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Risk & Volatility

Tencent has a beta of 0.29, suggesting that its share price is 71% less volatile than the S&P 500. Comparatively, Sify Technologies has a beta of 1.3, suggesting that its share price is 30% more volatile than the S&P 500.

Earnings and Valuation

This table compares Tencent and Sify Technologies”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Tencent	$104.58 billion	4.89	$31.28 billion	$3.58	15.66
Sify Technologies	$508.17 million	2.30	-$15.31 million	N/A	N/A

Tencent has higher revenue and earnings than Sify Technologies.

Summary

Tencent beats Sify Technologies on 9 of the 12 factors compared between the two stocks.

About Tencent

Tencent Holdings Limited, an investment holding company, offers value-added services (VAS), online advertising, fintech, and business services in the People's Republic of China and internationally. It operates through VAS, Online Advertising, FinTech and Business Services, and Others segments. The company's consumers business provides communication and services, such as instant messaging and social network; digital content including online games, videos, live streaming, news, music, and literature; fintech services, which includes mobile payment, wealth management, loans, and securities trading; and various tools, such as network security management, browser, navigation, application management, email, etc. Its enterprise business comprises marketing solutions, which offers digital tools including user insight, creative management, placement strategy, and digital assets management; and cloud services, such as cloud computing, big data analytics, artificial intelligence, Internet of Things, security and other technologies for financial services, education, healthcare, retail, industry, transport, energy, and radio & television application. In addition, the company operates innovation business, which includes artificial intelligences; and discover and develops enterprise and next-generation technologies for food production, energy, and water management application. Tencent Holdings Limited was formerly known as Tencent (BVI) Limited and changed its name to Tencent Holding Limited in February 2004. The company was founded in 1998 and is headquartered in Shenzhen, the People's Republic of China.

About Sify Technologies

Sify Technologies Limited offers ICT solutions and services in India and internationally. It operates through Network Centric Services, Data Center Services, and Digital Services segments. The company offers internet, internet protocol, multi-protocol label switching, virtual private network, SDWAN, managed Wi-Fi, internet of things, wholesale and retail voice, dedicated internet access, and proactive monitoring and management of the network and devices. It provides co-location services; and managed hosting services, such as storage, back-up management, performance monitoring, infrastructure monitoring and management, network availability, server load balancing, managed shared firewall, web server log reporting, and remote and smart hands services. In addition, it offers managed network services; EDGE services; cloud and managed services, including infrastructure as a service, platform as a service, virtual private data center, computing services, IT platform, backup and recovery solution, and content delivery network; remote and onsite infrastructure managed services; and managed security services. Further, the company provides technology integration services; application integration services, which includes talent management, supply chain management, web portal solutions content services, portal development and maintenance, eLearning, digital signature, SAP, Microsoft, Oracle services. The company was formerly known as Sify Limited and changed its name to Sify Technologies Limited in October 2007. Sify Technologies Limited was incorporated in 1995 and is headquartered in Chennai, India. Sify Technologies Limited is a subsidiary of Ramanand Core Investment Company Private Limited.