Which Is a Better Investment, F5 Inc or ePlus inc Stock? (2024)

Sifting through countless of stocks in the IT Services & Consulting industry can be tedious, and sometimes two stocks are just too similar to judge which is the better investment. If you’re on the fence about investing in ePlus inc or F5 Inc because you’re not sure how they measure up, it’s important to compare them on a few factors before making your decision.

Read on to learn how ePlus inc and F5 Inc compare based on key financial metrics to determine which better meets your investment needs.

ePlus inc. is a provider of technology solutions across the spectrum spanning security, cloud, data center, networking, collaboration, artificial intelligence, and emerging solutions. The Company’s segments include Product, Professional Services, Managed Services, and Financing. The Product segment includes sales of information technology (IT) products, third-party software, and third-party maintenance, software assurance, and other third-party services. The Professional services segment includes its advanced professional services, staff augmentation, project management services, cloud consulting services and security services. The Managed services segment includes its advanced managed services, service desk, storage-as-a-service, cloud hosted services, cloud managed services and managed security services. The Financing segment consists of the financing of IT equipment, software, and related services to commercial enterprises, state and local governments, and government contractors.

F5, Inc. is a multi-cloud application services and security company. The Company partners with various organizations to secure and optimize every app and application programming interface (API) anywhere - on premises, in the cloud, or at the edge. The Company's enterprise-grade application services are available as cloud-based, software-as-a-service, and software-only solutions optimized for multi-cloud environments, with modules that can run independently, or as part of an integrated solution on its high-performance appliances. The Company, through its BIG-IP, F5 NGINX and F5 Distributed Cloud Services product, offers a range of integrated, artificial intelligence- and machine learning-driven solutions that support performance and protect both legacy and modern applications and APIs across data center, cloud, and edge locations. Its products and solutions include F5 Distributed Cloud Web App and API Protection, F5 NGINX Ingress Controller, F5 BIG-IP Security, and F5 BIG-IP Systems.

As of April 18, 2024, ePlus inc had a $2.0 billion market capitalization, compared to the IT Services & Consulting median of $193.4 million. ePlus inc’s stock is NA in 2024, NA in the previous five trading days and up 49.34% in the past year.

Currently, ePlus inc’s price-earnings ratio is 15.8. ePlus inc’s trailing 12-month revenue is $2.2 billion with a 5.9% net profit margin. Year-over-year quarterly sales growth most recently was -18.3%. Analysts expect adjusted earnings to reach $5.160 per share for the current fiscal year. ePlus inc does not currently pay a dividend.

Currently, F5 Inc’s price-earnings ratio is 23.4. F5 Inc’s trailing 12-month revenue is $2.8 billion with a 16.4% net profit margin. Year-over-year quarterly sales growth most recently was -1.1%. Analysts expect adjusted earnings to reach $12.604 per share for the current fiscal year. F5 Inc does not currently pay a dividend.

Stock evaluation requires access to huge amounts of data and the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movements. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors streamline and work through such data.

AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A‐F grades for each of five key investing factors: value, growth, momentum, earnings estimate revisions and quality. Here, we’ll take a closer look at ePlus inc and F5 Inc’s stock grades to see how they measure up against one another.

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The foundation of growth investing is seeking out stocks of companies exhibiting strong, consistent and prolonged growth that is expected to continue into the future.

In order to compute the growth score and assign it a letter grade, the percentile ranks for each of three components‐consistency of annual sales growth, five-year sales growth rankings adjusted for extreme levels, and consistency of positive annual cash from operations‐must be determined. These three rank figures are added together, and the sum is ranked against the entire stock universe to arrive at a company’s Growth Score to create an equal distribution of grades.

The companies in the bottom 20% of the stock universe receive Growth Grades of F, considered to be very weak, while those in the top 20% receive A grades, which are considered very strong.

ePlus inc has a Growth Score of 68, which is Strong. F5 Inc has a Growth Score of 98, which is Very Strong.

Like the Value Grade, AAII’s A+ Investor Quality Grade comes from the percentile rank of key metrics. Specifically, the Quality Score is the percentile rank of the average of the percentile ranks of return on assets (ROA), return on invested capital (ROIC), gross profit relative to assets, buyback yield, change in total liabilities to assets, accruals, Z double prime bankruptcy risk (Z) score and the F-Score.

The score is variable, meaning it can consider all eight measures or, should any of the eight measures not be valid, the remaining measures that are valid. To be assigned a Quality Score, stocks must have a valid (non-null) measure and corresponding ranking for at least four of the eight quality measures.

The Quality Score is used to assess the underlying “quality” of a particular stock. A higher-quality stock possesses traits associated with upside potential and reduced downside risk. Backtesting of the Quality Grade shows that stocks with higher grades, on average, outperformed stocks with lower grades over the period of 1998 through 2019.

Stocks receive better grades (higher scores) for having higher scores for the quality subcomponents and worse grades (lower scores) for lower scores for the subcomponents.

ePlus inc has a Quality Score of 97, which is Very Strong. F5 Inc has a Quality Score of 96, which is Very Strong.

Earnings estimate revisions scores consider the magnitude of a company’s earnings surprise in its last two reported fiscal quarters. Often, positive surprises beget further positive surprises‐or at least continued sales growth (the exact opposite is generally true, too).

Estimate revisions offer an indication of what analysts are thinking about the short-term prospects of a firm. Estimate revisions are based on the statistical significance of a firm’s last two quarterly earnings surprises and the percentage change in its consensus estimate for the current fiscal year over the past month and past three months.

ePlus inc has a Earnings Estimate Score of 50, which is Neutral. F5 Inc has a Earnings Estimate Score of 82, which is Very Positive.

Momentum grades help uncover stocks experiencing anomalously high rates of return; research finds that stocks with high relative levels of momentum tend to outperform, whereas those with low levels of momentum tend to continue underperforming.

Successful stock investing involves buying low and selling high, so stock valuation is an important consideration for stock selection. Buying stocks that are going to go up typically means buying stocks that are undervalued in the first place, although momentum investors may argue that point.

These 2 key factors, when combined with the above, provide a holistic view into a particular stock. Further, by joining A+ Investor you can see whether ePlus inc and F5 Inc pass any of our 60+ stock screens that have outperformed the market since their creation.

Overall, ePlus inc stock has a Growth Score of 68, Estimate Revisions Score of 50 and Quality Score of 97.

F5 Inc stock has a Growth Score of 98, Estimate Revisions Score of 82 and Quality Score of 96.

Comparing ePlus inc and F5 Inc’s grades, scores and metrics can act as a solid basis to determine whether they may be a good investment or not. You’ll also want to look at your portfolio’s asset allocation as well as your risk tolerance and financial goals to see if either of these stocks would make a good fit for you. AAII can help you figure out which investments align with your individual needs and preferences.

Investors are encouraged to do their own due diligence and research. In this way, individuals can effectively become managers of their own assets‐without having to rely on others for financial independence. You can count on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis.

A+ Investor adds to our qualitative teaching with a powerful data suite to help you whittle down investment choices to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.