Tech Mahindra vs Infosys Which Is More Lucrative?

Tech Mahindra and Infosys are two of the leading IT services companies in India, with a strong presence in the global market. Both companies have a proven track record of delivering innovative solutions and services to a wide range of clients across various industries. However, when it comes to their stocks, there are some key differences to consider. While both companies have performed well in the past, Tech Mahindra’s stock has shown a more consistent growth trajectory compared to Infosys. Investors looking for a stable and potentially more lucrative investment may want to consider Tech Mahindra over Infosys.

Tech Mahindra or Infosys?

When comparing Tech Mahindra and Infosys, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Tech Mahindra and Infosys.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Tech Mahindra has a dividend yield of 2.42%, while Infosys has a dividend yield of 2.53%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Tech Mahindra reports a 5-year dividend growth of 25.74% year and a payout ratio of 0.00%. On the other hand, Infosys reports a 5-year dividend growth of -5.23% year and a payout ratio of 70.72%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Tech Mahindra P/E ratio at 48.09 and Infosys's P/E ratio at 29.30. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Tech Mahindra P/B ratio is 5.95 while Infosys's P/B ratio is 8.78.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Tech Mahindra has seen a 5-year revenue growth of 0.50%, while Infosys's is 0.65%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Tech Mahindra's ROE at 12.22% and Infosys's ROE at 31.58%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are ₹1771.20 for Tech Mahindra and $23.00 for Infosys. Over the past year, Tech Mahindra's prices ranged from ₹1162.95 to ₹1800.75, with a yearly change of 54.84%. Infosys's prices fluctuated between $16.04 and $23.48, with a yearly change of 46.38%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.