Head to Head Analysis: athenahealth (NASDAQ:ATHN) and Accenture (ACN)

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Accenture (NYSE:ACN) and athenahealth (NASDAQ:ATHN) are both business services companies, but which is the superior investment? We will contrast the two companies based on the strength of their earnings, risk, profitability, valuation, dividends, institutional ownership and analyst recommendations.

Valuation and Earnings

This table compares Accenture and athenahealth’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Accenture $41.60 billion 2.66 $4.06 billion $6.74 24.69
athenahealth $1.22 billion 4.49 $53.10 million $1.57 85.98

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

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Accenture and athenahealth, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Accenture 1 5 16 0 2.68
athenahealth 0 17 3 0 2.15

Accenture presently has a consensus price target of $173.74, indicating a potential upside of 4.42%. athenahealth has a consensus price target of $148.16, indicating a potential upside of 9.75%. Given athenahealth’s higher probable upside, analysts plainly believe athenahealth is more favorable than Accenture.

Dividends

Accenture pays an annual dividend of $2.92 per share and has a dividend yield of 1.8%. athenahealth does not pay a dividend. Accenture pays out 43.3% of its earnings in the form of a dividend. Accenture has raised its dividend for 9 consecutive years.

Profitability

This table compares Accenture and athenahealth’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Accenture 9.99% 40.31% 18.34%
athenahealth 9.57% 15.35% 10.04%

Insider and Institutional Ownership

70.1% of Accenture shares are owned by institutional investors. Comparatively, 94.3% of athenahealth shares are owned by institutional investors. 0.2% of Accenture shares are owned by company insiders. Comparatively, 2.9% of athenahealth 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.

Volatility & Risk

Accenture has a beta of 1.11, indicating that its stock price is 11% more volatile than the S&P 500. Comparatively, athenahealth has a beta of 0.75, indicating that its stock price is 25% less volatile than the S&P 500.

Summary

Accenture beats athenahealth on 11 of the 17 factors compared between the two stocks.

Accenture Company Profile

Accenture plc provides consulting, technology, and outsourcing services in Ireland and internationally. Its Communications, Media & Technology segment provides professional services that help clients accelerate and deliver digital transformation, develop industry-specific solutions, and enhance efficiencies and business results for communications, media, high tech, software, and platform companies. The company’s Financial Services segment offers services that address profitability pressures, industry consolidation, regulatory changes, and the need to continually adapt to new digital technologies for banking, capital markets, and insurance industries. Its Health & Public Service segment provides research-based insights and offerings, including consulting services and digital solutions to help clients deliver social, economic, and health outcomes for healthcare payers and providers, as well as government departments and agencies, public service organizations, educational institutions, and non-profit organizations. The company’s Products segment helps clients enhance their performance in distribution, sales, and marketing; in research and development, and manufacturing; and in business functions, such as finance, human resources, procurement, and supply chain. This segment serves clients in consumer goods, retail, and travel services industries; automotive, freight and logistics, industrial and electrical equipment, consumer durable and heavy equipment, and construction and infrastructure management companies; and pharmaceutical, medical technology, and biotechnology companies. Its Resources segment enables clients in chemicals, energy, forest products, metals and mining, and utilities and related industries to develop and implement strategies, improve operations, manage complex change initiatives, and integrate digital technologies. Accenture plc has a strategic alliance with Quantexa. Accenture plc was founded in 1989 and is based in Dublin, Ireland.

athenahealth Company Profile

athenahealth, Inc., together with its subsidiaries, provides network-based medical record, revenue cycle, patient engagement, care coordination, and population health services for medical groups and health systems. It offers athenaCollector, a network-enabled billing and practice management solution; athenaClinicals, an electronic health record for managing patient’s clinical documentation; athenaCommunicator, an engagement and communication solution that provides an automated communication service between patients and provider practices for interactions outside the exam room; and athenaCoordinator for order transmission and care coordination services. The company also provides athenahealth Population Health, a cloud-based population health service; and Epocrates services that include clinical information and decision support services in the areas of drug and disease information, medical calculator and tools, clinical guidelines, clinical messaging, and market research. In addition, it offers athenahealth Health Plan data exchange facilitates to exchange the data between providers and health plans for the healthcare operations of clients; athenaOne Analytics that includes an analytics and dashboard application, as well as provides visibility into the financial and operational health of an organization; and pre-certification processing and referral processing services. The company serves healthcare providers, medical groups, and health systems through its direct sales force and channel partners in the United States and internationally. athenahealth, Inc. was formerly known as athenahealth.com, Inc. and changed its name to athenahealth, Inc. in November 2000. The company was founded in 1997 and is headquartered in Watertown, Massachusetts.



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