Critical Survey: CSP (CSPI) vs. Nextgen Healthcare (NXGN)

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CSP (NASDAQ:CSPI) and Nextgen Healthcare (NASDAQ:NXGN) are both small-cap computer and technology companies, but which is the better stock? We will compare the two companies based on the strength of their dividends, valuation, analyst recommendations, profitability, risk, earnings and institutional ownership.

Dividends

CSP pays an annual dividend of $0.60 per share and has a dividend yield of 4.5%. Nextgen Healthcare does not pay a dividend. CSP has increased its dividend for 6 consecutive years.

Profitability

This table compares CSP and Nextgen Healthcare’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CSP 20.03% -5.48% -2.92%
Nextgen Healthcare 1.80% 10.66% 6.96%

Insider and Institutional Ownership

24.9% of CSP shares are held by institutional investors. Comparatively, 71.5% of Nextgen Healthcare shares are held by institutional investors. 10.1% of CSP shares are held by insiders. Comparatively, 17.9% of Nextgen Healthcare shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Risk and Volatility

CSP has a beta of 1.22, indicating that its stock price is 22% more volatile than the S&P 500. Comparatively, Nextgen Healthcare has a beta of 1.18, indicating that its stock price is 18% more volatile than the S&P 500.

Valuation & Earnings

This table compares CSP and Nextgen Healthcare’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
CSP $72.92 million 0.76 $14.44 million N/A N/A
Nextgen Healthcare $531.02 million 2.33 $2.42 million $0.57 33.60

CSP has higher earnings, but lower revenue than Nextgen Healthcare.

Analyst Recommendations

This is a breakdown of recent recommendations for CSP and Nextgen Healthcare, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CSP 0 0 0 0 N/A
Nextgen Healthcare 1 1 4 0 2.50

Nextgen Healthcare has a consensus price target of $19.20, indicating a potential upside of 0.26%. Given Nextgen Healthcare’s higher possible upside, analysts plainly believe Nextgen Healthcare is more favorable than CSP.

Summary

Nextgen Healthcare beats CSP on 8 of the 13 factors compared between the two stocks.

CSP Company Profile

CSP Inc. develops and markets IT integration solutions, security and managed services, purpose built network adapters, and cluster computer systems for commercial and defense customers worldwide. The company's High Performance Products segment offers computing systems for digital signal processing applications in the defense market; Ethernet adapters and solutions for various applications in the packet capture, financial transaction, and storage interconnect markets; ARC Series adapters for financial trading and network monitoring; and nVoy Series products comprising 100G Packet Broker and 10G Packet Recorder, and specialized software under the Myricom brand. Its Technology Solutions segment provides third-party computer hardware and software as a value added reseller to various customers in Web and infrastructure hosting, education, telecommunications, healthcare services, distribution, financial and professional services, and manufacturing industries. This segment also offers professional IT consulting services, such as implementation, integration, migration, configuration, installation, and project management; storage and virtualization solutions; enterprise security intrusion prevention, network access control, and unified threat management services; and IT security compliance services. In addition, this segment provides unified communications, wireless, and routing and switching solutions; custom software applications and solutions development and support services; maintenance and technical support services; and managed IT services, such as monitoring, reporting, and management of alerts for the resolution and preventive general IT, as well as IT security support tasks. Further, this segment offers managed and cloud services, such as proactive monitoring and remote management of IT Infrastructure, collaboration and resale, security, and backup and replication. CSP Inc. was founded in 1968 and is headquartered in Lowell, Massachusetts.

Nextgen Healthcare Company Profile

NextGen Healthcare, Inc. provides software, services, and analytics solutions to medical and dental group practices in the United States. The company's principal products include NextGen Enterprise EHR, which stores and maintains clinical patient information; and a workflow module, prescription management, automatic document and letter generation, patient education, referral tracking, interfaces to billing and lab systems, physician alerts and reminders, and reporting and data analysis tools. Its products also comprise NextGen Enterprise PM, a practice management (PM) solution; and NextGen Office, a cloud-based electronic health record and PM solution. In addition, the company offers automation and workflow solutions, including NextGen Mobile Health Solutions, NextGen Electronic Healthcare Transactions, NextGen Pre-Service Clearance, and NextGen Patient Payment solutions. Further, it provides analytics, population health, and patient engagement solutions, such as NextGen Population Health Informed Analytics, NextGen Population Health Patient Care Coordination, NextGen Population Health Performance Management, and NextGen Patient Portal solutions. Additionally, the company offers NextGen Connected Health and NextGen Share interoperability solutions. It also provides professional services, including training, project management, functional and detailed specification preparation, configuration, testing, installation, support, and client services. It serves physician hospital and management service organizations, independent physician associations, accountable care organizations, ambulatory care centers, and community health centers through a sales force and reseller channel. NextGen Healthcare, Inc. has a strategic partnership with OTTO Health LLC. The company was formerly known as Quality Systems, Inc. and changed its name to NextGen Healthcare, Inc. in September 2018. NextGen Healthcare, Inc. was founded in 1974 and is headquartered in Irvine, California.

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