Critical Analysis: Relx (NYSE:RELX) and Steel Connect (NASDAQ:STCN)

Relx (NYSE:RELX) and Steel Connect (NASDAQ:STCN) are both computer and technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, profitability, valuation, analyst recommendations, dividends, earnings and institutional ownership.

Earnings & Valuation

This table compares Relx and Steel Connect”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Relx	$9.30 billion	9.10	$2.22 billion	N/A	N/A
Steel Connect	$183.26 million	0.43	$87.98 million	$2.99	4.18

Relx has higher revenue and earnings than Steel Connect.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Relx and Steel Connect, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Relx	0	1	0	1	3.00
Steel Connect	0	0	0	0	0.00

Profitability

This table compares Relx and Steel Connect’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Relx	N/A	N/A	N/A
Steel Connect	50.53%	14.59%	3.67%

Risk & Volatility

Relx has a beta of 0.89, indicating that its stock price is 11% less volatile than the S&P 500. Comparatively, Steel Connect has a beta of 0.25, indicating that its stock price is 75% less volatile than the S&P 500.

Insider and Institutional Ownership

15.0% of Relx shares are owned by institutional investors. Comparatively, 47.3% of Steel Connect shares are owned by institutional investors. 0.0% of Relx shares are owned by company insiders. Comparatively, 8.7% of Steel Connect shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Summary

Relx beats Steel Connect on 6 of the 11 factors compared between the two stocks.

About Relx

RELX PLC, together with its subsidiaries, provides information-based analytics and decision tools for professional and business customers in North America, Europe, and internationally. It operates through four segments: Risk; Scientific, Technical & Medical; Legal; and Exhibitions. The Risk segment offers information-based analytics and decision tools that combine public and industry specific content with technology and algorithms to assist clients in evaluating and predicting risk. The Scientific, Technical & Medical segment provides information and data sets that help researchers and healthcare professionals to advance science and health outcomes. The Legal segment provides legal, regulatory, and business information and analytics that help customers in decision-making, as well as increases the productivity. The Exhibitions segment is involved in the business that combines face-to-face with data and digital tools to help customers learn about markets, source products, and complete transactions. The company was formerly known as Reed Elsevier PLC and changed its name to RELX PLC in July 2015. RELX PLC was incorporated in 1903 and is headquartered in London, the United Kingdom.

About Steel Connect

Steel Connect, Inc., together with its subsidiaries, provides supply chain services in the United States, Mainland China, Netherlands, and internationally. It offers product configuration and packaging, kitting, and assembly of components and parts into finished goods; and value-added processes, such as product testing, radio frequency identification tagging, product or service activation, language settings, personalization and engraving, multi-channel packaging, and packaging design services. The company provides fulfillment services comprising order management, pick, pack and ship, retail compliance, and demand planning services; and reverse logistics services that simplifies the returns process for retailers and manufacturers, as well as operates a cloud-based e-commerce platform. In addition, it offers warehousing and inventory management services; and software licenses, maintenance, and support services. Further, the company offers its supply chain services to customers in the consumer electronics, communications, computing, medical devices, software, and retail markets. The company was formerly known as ModusLink Global Solutions, Inc. and changed its name to Steel Connect, Inc. in February 2018. Steel Connect, Inc. was incorporated in 1986 and is headquartered in New York, New York.