Q: Both KXS and MANH offer software solutions to manage supply chains.
KXS has low single digit operating margins and ROIC.
MANH has high operating margins (20%+), and high ROIC (40%+).
They have similar gross profit margins (~50-60%), and in fact, KXS is the higher of the 2. In comparison, is KXS "bleeding" money on certain expenditures that MANH is not, or why does MANH screen so much better? What is MANH doing different that has allowed its stock to grow over 3x the CAGR of KXS over the past 5 years?
If your investable universe included US stocks, would you side with MANH going forward as a replacement to KXS in your model portfolio?
Thanks,
KXS has low single digit operating margins and ROIC.
MANH has high operating margins (20%+), and high ROIC (40%+).
They have similar gross profit margins (~50-60%), and in fact, KXS is the higher of the 2. In comparison, is KXS "bleeding" money on certain expenditures that MANH is not, or why does MANH screen so much better? What is MANH doing different that has allowed its stock to grow over 3x the CAGR of KXS over the past 5 years?
If your investable universe included US stocks, would you side with MANH going forward as a replacement to KXS in your model portfolio?
Thanks,
5i Research Answer:
It is hard to pinpoint exactly but there are some possibilities. MANH does have a higher...