Analyzing Grid Dynamics (NASDAQ:GDYN) and NICE (NASDAQ:NICE)

Grid Dynamics (NASDAQ:GDYN) and NICE (NASDAQ:NICE) are both computer and technology companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, analyst recommendations, institutional ownership, dividends, profitability, earnings and risk.

Earnings and Valuation

This table compares Grid Dynamics and NICE”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Grid Dynamics	$328.36 million	5.16	-$1.76 million	$0.03	684.33
NICE	$2.64 billion	4.18	$338.30 million	$6.46	27.15

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

Analyst Recommendations

This is a summary of current ratings and recommmendations for Grid Dynamics and NICE, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Grid Dynamics	0	0	5	1	3.17
NICE	0	3	12	0	2.80

Grid Dynamics currently has a consensus target price of $18.33, suggesting a potential downside of 10.70%. NICE has a consensus target price of $259.50, suggesting a potential upside of 47.93%. Given NICE’s higher possible upside, analysts clearly believe NICE is more favorable than Grid Dynamics.

Profitability

This table compares Grid Dynamics and NICE’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Grid Dynamics	0.74%	0.15%	0.13%
NICE	16.11%	15.31%	10.40%

Institutional and Insider Ownership

71.2% of Grid Dynamics shares are held by institutional investors. Comparatively, 63.3% of NICE shares are held by institutional investors. 7.2% of Grid Dynamics shares are held by company insiders. Comparatively, 0.0% of NICE shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Volatility and Risk

Grid Dynamics has a beta of 1.06, indicating that its share price is 6% more volatile than the S&P 500. Comparatively, NICE has a beta of 1.05, indicating that its share price is 5% more volatile than the S&P 500.

Summary

NICE beats Grid Dynamics on 8 of the 15 factors compared between the two stocks.

About Grid Dynamics

Grid Dynamics Holdings, Inc., together with its subsidiaries, provides technology consulting, platform and product engineering, and analytics services in North America, Europe, and internationally. It offers cloud platform and product engineering services, such as architecting, designing, and building scalable and secure cloud-based platforms and business applications; and AI/machine learning and data platform engineering services that build platforms to facilitate batch and streaming data ingestion, quality governance, orchestration, semantic modeling, observability, and analysis at scale. The company provides digital engagement services, including digital ecosystem design and implementation; and supply chain, Internet of Thing, and advanced manufacturing, which focuses on transforming traditional operations into smart and connected ecosystems. It serves customers that operate in the tech, media, telecommunications, retail, consumer packaged goods, manufacturing, and finance industries. The company was formerly known as ChaSerg Technology Acquisition Corp. and changed its name to Grid Dynamics Holdings, Inc. Grid Dynamics Holdings, Inc. was founded in 2006 and is headquartered in San Ramon, California.

About NICE

NICE Ltd., together with its subsidiaries, provides cloud platforms for AI-driven digital business solutions worldwide. It offers CXone, a cloud native open platform; Enlighten, an AI engine for the customer engagement market; and smart self service enable organizations to address consumers' needs; and journey orchestration solutions that empower organizations to connect and route customers to deal with the customer's request, and connects them using real time AI-based routing. The company provides smart self service solutions that empower organizations to build intelligent automated conversations based on data; and prepared agent solutions and tools enable contact center agents to guide and alert them in real time; provides solutions that help organizations to record structured and unstructured customer interaction and transaction data; and NICE Evidencentral, an digital evidence management platform for public safety emergency communications, law enforcement, and criminal justice helps agencies. In addition, it offers X-Sight, is an open and flexible AI-cloud platform for financial crime and compliance; Xceed, a cloud platform for comprehensive AML and fraud prevention for small and mid-sized organizations; data intelligence solutions that enable organizations to turn raw data into comprehensive actionable intelligence to prevent and detect financial crimes; AI and analytics technologies to detect and prevent financial crimes in real-time; money laundering and fraud prevention solutions that help organizations adhere to capital markets compliance and anti-money laundering compliance regulations; intelligent investigations solutions; and self-service solutions that provide organizations with customization and self-development capabilities. The company was formerly known as NICE-Systems Ltd. and changed its name to NICE Ltd. in June 2016. NICE Ltd. was founded in 1986 and is headquartered in Ra'anana, Israel.