Financial Review: Atlantic International (NASDAQ:ATLN) versus Barrett Business Services (NASDAQ:BBSI)

Atlantic International (NASDAQ:ATLN) and Barrett Business Services (NASDAQ:BBSI) are both small-cap business services companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, earnings, dividends, profitability, risk, institutional ownership and analyst recommendations.

Profitability

This table compares Atlantic International and Barrett Business Services’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Atlantic International	N/A	-298.20%	-42.32%
Barrett Business Services	4.55%	25.28%	7.04%

Institutional and Insider Ownership

86.8% of Barrett Business Services shares are owned by institutional investors. 22.3% of Atlantic International shares are owned by insiders. Comparatively, 3.7% of Barrett Business Services shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Risk and Volatility

Atlantic International has a beta of 1.86, suggesting that its stock price is 86% more volatile than the S&P 500. Comparatively, Barrett Business Services has a beta of 1.31, suggesting that its stock price is 31% more volatile than the S&P 500.

Earnings & Valuation

This table compares Atlantic International and Barrett Business Services”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Atlantic International	$27.89 million	8.97	-$5.63 million	($8.24)	-0.61
Barrett Business Services	$1.14 billion	0.89	$50.61 million	$1.99	19.88

Barrett Business Services has higher revenue and earnings than Atlantic International. Atlantic International is trading at a lower price-to-earnings ratio than Barrett Business Services, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current ratings and price targets for Atlantic International and Barrett Business Services, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Atlantic International	0	0	0	0	0.00
Barrett Business Services	0	1	2	0	2.67

Barrett Business Services has a consensus target price of $41.67, indicating a potential upside of 5.33%. Given Barrett Business Services’ stronger consensus rating and higher probable upside, analysts clearly believe Barrett Business Services is more favorable than Atlantic International.

Summary

Barrett Business Services beats Atlantic International on 11 of the 14 factors compared between the two stocks.

About Atlantic International

Atlantic International Corp. engages in the design, development, and manufacture of genetic analysis technologies. Its services include RNA sequencing and DNA sequencing. The company was founded by William C. St. Laurent and Daniel R. Jones in 2013 and is headquartered in Billercia, MA.

About Barrett Business Services

Barrett Business Services, Inc. provides business management solutions for small and mid-sized companies in the United States. The company develops a management platform that integrates a knowledge-based approach from the management consulting industry with tools from the human resource outsourcing industry. It offers professional employer services under which it enters into a client services agreement to establish a co-employment relationship with each client company, assuming responsibility for payroll, payroll taxes, workers compensation coverage, and other administration functions for the client’s existing workforce. The company provides staffing and recruiting services, such as on-demand or short-term staffing assignment, contract staffing, direct placement, and long-term or indefinite-term on-site management services. It serves electronics manufacturers, light-manufacturing industries, agriculture-based companies, transportation and shipping enterprises, food processors, telecommunications companies, public utilities, general contractors in various construction-related fields, restaurant franchises, and professional services firms. Barrett Business Services, Inc. was incorporated in 1965 and is headquartered in Vancouver, Washington.