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

Earnings and Valuation

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

Gross Revenue EBITDA Price/Earnings Ratio
Aspen Technology $482.94 million $218.97 million 30.86
Aspen Technology Competitors $2.14 billion $366.28 million 16.91

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

Risk and Volatility

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

Institutional and Insider Ownership

60.9% of shares of all “IT Services & Consulting” companies are held by institutional investors. 0.6% of Aspen Technology shares are held by insiders. Comparatively, 16.8% of shares of all “IT Services & Consulting” companies are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Aspen Technology and its rivals, 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 683 4449 7454 168 2.56

Aspen Technology currently has a consensus target price of $60.71, suggesting a potential downside of 7.21%. As a group, “IT Services & Consulting” companies have a potential downside of 0.90%. Given Aspen Technology’s rivals stronger consensus rating and higher probable upside, analysts plainly believe Aspen Technology has less favorable growth aspects than its rivals.

Profitability

This table compares Aspen Technology and its rivals’ 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 -20.94% -52.76% -4.36%

Summary

Aspen Technology rivals 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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