WageWorks (WAGE) vs. Lionbridge Technologies (LIOX) Critical Survey

WageWorks (NYSE: WAGE) and Lionbridge Technologies (NASDAQ:LIOX) are both business services companies, but which is the better stock? We will compare the two businesses based on the strength of their valuation, profitability, dividends, analyst recommendations, risk, earnings and institutional ownership.

Institutional & Insider Ownership

63.3% of Lionbridge Technologies shares are owned by institutional investors. 3.5% of WageWorks shares are owned by company insiders. Comparatively, 11.4% of Lionbridge Technologies shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings for WageWorks and Lionbridge Technologies, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
WageWorks 0 1 4 0 2.80
Lionbridge Technologies 0 1 0 0 2.00

WageWorks presently has a consensus price target of $83.00, indicating a potential upside of 36.85%. Lionbridge Technologies has a consensus price target of $5.75, indicating a potential upside of 0.00%. Given WageWorks’ stronger consensus rating and higher probable upside, equities analysts plainly believe WageWorks is more favorable than Lionbridge Technologies.

Profitability

This table compares WageWorks and Lionbridge Technologies’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
WageWorks 9.87% 9.60% 3.37%
Lionbridge Technologies 1.97% 12.05% 3.60%

Earnings & Valuation

This table compares WageWorks and Lionbridge Technologies’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
WageWorks $364.71 million 6.59 $20.20 million $1.17 51.84
Lionbridge Technologies N/A N/A N/A $0.16 35.94

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

Summary

WageWorks beats Lionbridge Technologies on 6 of the 10 factors compared between the two stocks.

About WageWorks

WageWorks, Inc. is engaged in administering Consumer-Directed Benefits (CDBs). The Company administers CBDs, including pre-tax spending accounts, such as Health Savings Accounts (HSAs), health and dependent care Flexible Spending Accounts (FSAs), and Health Reimbursement Arrangements (HRAs), as well as Commuter Benefit Services, including transit and parking programs, wellness programs, Consolidated Omnibus Budget Reconciliation Act (COBRA) and other employee benefits. Its CDB programs assist employees and their families in saving money by using pre-tax dollars to pay for certain of their healthcare, dependent care and commuter expenses. Employers financially benefit from its programs through reduced payroll taxes. It provides operational support services to its clients and its cross-functional teams, including customer support and claims processing. It administers HSAs for employers that allow employee participants to invest funds to be used for qualified healthcare expenses.

About Lionbridge Technologies

Lionbridge Technologies, Inc. is a United States-based company, which provides translation, online marketing, global content management and application testing solutions. The Company enables more than 800 brands to manage international market share and engage their customers in local markets across the world. It offers various solutions, such as Language Translation Services, Global Marketing Services, Website Translation and Localization, Engineering, Technical Publications and Training, Testing Services and Translation Technology. Its portfolio of language translation services includes Website Translation, Software Localization, Real-Time Translation for Chat and Forums, and Interpreter Services. Its Data Management Services allow companies to manage unprocessed data from multiple languages. Its Crowd translation of user-generated content (blogs, messages, surveys, reviews) allows clients to repurpose pieces of consumer advocacy for a new target language.

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