Analyzing SofTech (OTCMKTS:SOFT) and Light & Wonder (NASDAQ:LNW)

Light & Wonder (NASDAQ:LNW) and SofTech (OTCMKTS:SOFT) are both consumer discretionary companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, profitability, valuation, analyst recommendations, dividends, earnings and risk.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Light & Wonder and SofTech, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Light & Wonder	1	4	6	2	2.69
SofTech	0	0	0	0	0.00

Light & Wonder presently has a consensus price target of $107.36, suggesting a potential upside of 25.38%. Given Light & Wonder’s stronger consensus rating and higher possible upside, equities analysts clearly believe Light & Wonder is more favorable than SofTech.

Profitability

This table compares Light & Wonder and SofTech’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Light & Wonder	9.30%	49.91%	7.27%
SofTech	N/A	N/A	N/A

Earnings & Valuation

This table compares Light & Wonder and SofTech”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Light & Wonder	$3.16 billion	2.39	$163.00 million	$3.22	26.59
SofTech	N/A	N/A	N/A	N/A	N/A

Light & Wonder has higher revenue and earnings than SofTech.

Institutional and Insider Ownership

88.1% of Light & Wonder shares are held by institutional investors. 2.1% of Light & Wonder shares are held by company insiders. Comparatively, 28.6% of SofTech shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Volatility & Risk

Light & Wonder has a beta of 1.73, suggesting that its share price is 73% more volatile than the S&P 500. Comparatively, SofTech has a beta of 1.38, suggesting that its share price is 38% more volatile than the S&P 500.

Summary

Light & Wonder beats SofTech on 10 of the 11 factors compared between the two stocks.

About Light & Wonder

Light & Wonder, Inc. operates as a cross-platform games company in the United States and internationally. The company operates through three segments: Gaming, SciPlay, and iGaming segments. The Gaming segment sells game content and gaming machine; video gaming terminals; video lottery terminals, including conversion kits and spare parts; and table products, including automatic card shufflers, deck checkers, table roulette chip sorters and other land-based table gaming equipment. It also leases or provides gaming content, gaming machines, and server-based system; sells and supports casino-management system based software and hardware; and licenses proprietary table games content to commercial, tribal and governmental gaming operators. The SciPlay segment develops, markets, and operates social games on various mobile and web platforms, as well as other games in the hyper-casual space. It sells virtual coins, chips, or bingo cards, which players can use to play slot games, table games, or bingo games. The iGaming segment provides a suite of digital gaming content, distribution platforms, player account management systems, and other iGaming content and services. This segment also offers the Open Platform System, which offers a range of reporting and administrative functions and tools providing operators control over various areas of digital gaming operations. Light & Wonder, Inc. was incorporated in 1984 and is headquartered in Las Vegas, Nevada.

About SofTech

SofTech, Inc. develops, markets, distributes, and supports computer aided design (CAD), and product data management and collaboration computer solutions for the product lifecycle management (PLM) industry primarily in North America, Europe, and Asia. The company offers ProductCenter, a collaborative PLM solution, which manages the engineering data and electronic files of discrete parts designed in various used third party proprietary design technologies; delivers a combination of document management, design integration, configuration control, change management, bill of materials management, and integration capability with other enterprise-wide systems; enables secure management of product information; and allows engineers and the design chain to manage, share, modify, and track product data and documents in the product development lifecycle. Its ProductCenter technology also allows employees, customers, suppliers, and other team members to securely exchange product information while maintaining a centralized database of critical product data; and enables integration with other business applications, such as enterprise resource planning, supply chain management, and customer relationship management for data exchange across the product lifecycle. In addition, the company offers Connector platform, a technology that allows for a direct interface between Aras Corporation’s Innovator solution and CAD products. SofTech, Inc. markets and distributes its products and services primarily through a direct sales force and its service organization, as well as through resellers. The company was founded in 1969 and is headquartered in Lowell, Massachusetts.