Head-To-Head Review: StoneCo (NASDAQ:STNE) vs. Forge Global (NYSE:FRGE)

Forge Global (NYSE:FRGE) and StoneCo (NASDAQ:STNE) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, earnings, dividends, profitability, valuation and risk.

Profitability

This table compares Forge Global and StoneCo’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Forge Global	-71.87%	-29.06%	-24.63%
StoneCo	22.92%	22.19%	4.10%

Valuation & Earnings

This table compares Forge Global and StoneCo”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Forge Global	$92.88 million	6.71	-$66.33 million	($5.20)	-8.65
StoneCo	$2.53 billion	0.92	$425.73 million	$2.48	3.77

StoneCo has higher revenue and earnings than Forge Global. Forge Global is trading at a lower price-to-earnings ratio than StoneCo, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current ratings and price targets for Forge Global and StoneCo, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Forge Global	1	4	0	0	1.80
StoneCo	0	6	4	0	2.40

Forge Global currently has a consensus price target of $45.00, indicating a potential upside of 0.00%. StoneCo has a consensus price target of $14.30, indicating a potential upside of 53.10%. Given StoneCo’s stronger consensus rating and higher possible upside, analysts clearly believe StoneCo is more favorable than Forge Global.

Insider and Institutional Ownership

40.7% of Forge Global shares are owned by institutional investors. Comparatively, 73.2% of StoneCo shares are owned by institutional investors. 4.5% of Forge Global shares are owned by insiders. Comparatively, 11.3% of StoneCo shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Risk & Volatility

Forge Global has a beta of 2.18, meaning that its stock price is 118% more volatile than the S&P 500. Comparatively, StoneCo has a beta of 1.75, meaning that its stock price is 75% more volatile than the S&P 500.

Summary

StoneCo beats Forge Global on 12 of the 14 factors compared between the two stocks.

About Forge Global

Forge Global Holdings, Inc. operates a financial services platform in California. The company's platform solutions include trading solutions, a platform that connects investors with private company stockholders and enables them to facilitate private share transactions; and custody solutions, a non-depository trust company that enables clients to securely custody and manage assets through an online portal. It also provides data solutions, such as information and insight to navigate, analyze, and make investment decisions to market participants in the private market. The company was founded in 2014 and is headquartered in San Francisco, California.

About StoneCo

StoneCo Ltd. provides financial technology and software solutions to merchants and integrated partners to conduct electronic commerce across in-store, online, and mobile channels in Brazil. It distributes its solutions, principally through proprietary Stone Hubs, which offer hyper-local sales and services; and sells solutions to brick-and-mortar and digital merchants through sales team. The company served small-and-medium-sized businesses; and marketplaces, e-commerce platforms, and integrated software vendors. StoneCo Ltd. was founded in 2000 and is headquartered in George Town, the Cayman Islands.