Exponent (NASDAQ:EXPO) versus Issuer Direct (NYSE:ISDR) Critical Review

Exponent (NASDAQ:EXPO) and Issuer Direct (NYSE:ISDR) are both business services companies, but which is the better stock? We will contrast the two businesses based on the strength of their valuation, profitability, dividends, analyst recommendations, institutional ownership, earnings and risk.

Earnings and Valuation

This table compares Exponent and Issuer Direct”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Exponent	$558.51 million	7.44	$109.00 million	$2.12	38.56
Issuer Direct	$33.38 million	0.00	$770,000.00	($0.35)	N/A

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

Risk and Volatility

Exponent has a beta of 0.77, suggesting that its share price is 23% less volatile than the S&P 500. Comparatively, Issuer Direct has a beta of 0.77, suggesting that its share price is 23% less volatile than the S&P 500.

Profitability

This table compares Exponent and Issuer Direct’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Exponent	19.52%	27.27%	15.24%
Issuer Direct	-4.54%	5.03%	2.80%

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Exponent and Issuer Direct, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Exponent	0	0	1	0	3.00
Issuer Direct	0	0	0	0	0.00

Exponent currently has a consensus target price of $120.00, indicating a potential upside of 46.79%. Given Exponent’s stronger consensus rating and higher probable upside, analysts clearly believe Exponent is more favorable than Issuer Direct.

Insider & Institutional Ownership

92.4% of Exponent shares are held by institutional investors. Comparatively, 50.0% of Issuer Direct shares are held by institutional investors. 2.1% of Exponent shares are held by company insiders. Comparatively, 26.9% of Issuer Direct shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Summary

Exponent beats Issuer Direct on 11 of the 12 factors compared between the two stocks.

About Exponent

Exponent, Inc., together with its subsidiaries, operates as a science and engineering consulting company in the United States and internationally. The company operates in two segments, Engineering and Other Scientific, and Environmental and Health. The Engineering and Other Scientific segment provides services in the areas of biomechanics, biomedical engineering and sciences, buildings and structures, civil engineering, construction consulting, data sciences, electrical engineering and computer science, human factors, materials and corrosion engineering, mechanical engineering, polymer science and materials chemistry, thermal sciences, and vehicle engineering. The Environmental and Health segment offers services in the areas of chemical regulation and food safety, ecological and biological sciences, environmental and earth sciences, and health sciences. The company offers approximately 90 technical disciplines to solve pressing and complicated challenges facing stakeholders. It serves clients in chemical, construction, consumer products, energy, food, beverage and nutrition, government, life sciences, insurance, manufacturing, technology, industrial equipment, transportation, and other sectors of the economy. The company was formerly known as The Failure Group, Inc. and changed its name to Exponent, Inc. in 1998. The company was founded in 1967 and is headquartered in Menlo Park, California.

About Issuer Direct

Issuer Direct Corporation operates as a communications and compliance company, provides solutions for both public relations and investor relations professionals in the United States and internationally. The company provides press release distribution, media databases, media monitoring, and newsrooms through media advantage platform; ACCESSWIRE, a news dissemination and media outreach service; and Webcaster Platform, a cloud-based webcast, webinar, and virtual meeting platform that delivers live and on-demand streaming of events to audiences of various sizes, as well as allows customers to create, produce, and deliver events. It also offers professional conference and events software, a mobile app that offers organizers, issuers, and investors to register, request, and approve one-on-one meetings, as well as manage schedules, perform event promotion and sponsorship, print attendee badges, and manage lodging; and investor relations content network, a series of data feeds, which include news feeds, stock feeds, fundamentals, regulatory filings, corporate governance, and other components. In addition, the company provides whistleblower hotline, a system that delivers secure notifications and basic incident workflow management processes that align with a company’s corporate governance whistleblower policy; stock transfer module, which offers access to real-time information about their shareholders, stock ledgers, and reports, as well as issues new shares; and proxy module, a real-time voting platform for customers and their shareholders of record. It serves public and private companies, mutual funds, law firms, brokerage firms, investment banks, individuals, and other institutions. The company was incorporated in 1988 and is headquartered in Raleigh, North Carolina.