Head to Head Review: Tenable (NASDAQ:TENB) and Sprout Social (NASDAQ:SPT)

Sprout Social (NASDAQ:SPT) and Tenable (NASDAQ:TENB) are both technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, institutional ownership, profitability, earnings, dividends, risk and valuation.

Institutional and Insider Ownership

89.1% of Tenable shares are held by institutional investors. 9.6% of Sprout Social shares are held by company insiders. Comparatively, 1.7% of Tenable shares are held by company 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.

Analyst Recommendations

This is a breakdown of recent ratings for Sprout Social and Tenable, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sprout Social	2	4	4	0	2.20
Tenable	1	11	10	0	2.41

Sprout Social presently has a consensus price target of $10.88, suggesting a potential downside of 9.75%. Tenable has a consensus price target of $46.25, suggesting a potential downside of 8.87%. Given Tenable’s stronger consensus rating and higher probable upside, analysts plainly believe Tenable is more favorable than Sprout Social.

Volatility & Risk

Sprout Social has a beta of 1.01, indicating that its stock price is 1% more volatile than the S&P 500. Comparatively, Tenable has a beta of 1.01, indicating that its stock price is 1% more volatile than the S&P 500.

Valuation and Earnings

This table compares Sprout Social and Tenable”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sprout Social	$481.82 million	1.52	-$43.33 million	($0.50)	-24.10
Tenable	$1.07 billion	5.24	-$36.12 million	$0.13	390.38

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

Profitability

This table compares Sprout Social and Tenable’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sprout Social	-6.13%	-8.80%	-3.64%
Tenable	1.48%	28.72%	3.19%

Summary

Tenable beats Sprout Social on 12 of the 13 factors compared between the two stocks.

About Sprout Social

Sprout Social, Inc. designs, develops, and operates a web-based social media management platform in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company provides cloud software for social messaging, data and workflows in a unified system of record, intelligence, and action. It offers integrated tools, such as social engagement/response; publishing; reporting and analytics; social listening and business intelligence; reputation management; social commerce; employee advocacy; and automation and workflows. In addition, the company provides smart inbox, social customer relationship management, social monitoring and alerts, customer service tools, and automation; and centralized content planning, creation, and publishing, automated scheduling, content performance reporting, suggested content, message approval workflows, publishing permissions and governance, and content and asset libraries. Further, it offers social media; content performance, customer service and team, custom report builder, and reporting API; and market research, brand health, competitive insights, consumer trends, and product feedback; and social commerce, reputation management, employee advocacy, mobile applications, and chat bot creation and management. Additionally, the company offers professional services consisting of consulting and training services. It serves social and community management; public relations; marketing; influencer marketing; customer service and care; commerce, sales and customer acquisition; recruiting and hiring, product development, and business strategy; and small-and-medium-sized businesses, mid-market companies, enterprises, marketing agencies, government, non-profit, and educational institutions. Sprout Social, Inc. was incorporated in 2010 and is headquartered in Chicago, Illinois.

About Tenable

Tenable Holdings, Inc. provides cyber exposure solutions for in the Americas, Europe, the Middle East, Africa, the Asia Pacific, and Japan. Its platforms include Tenable Vulnerability Management, a cloud-delivered software as a service that provides organizations with a risk-based view of traditional and modern attack surfaces; Tenable Cloud Security, a cloud-native cloud security solutions for security teams to continuously assess the security posture; Tenable Identity Exposure, a solution to secure Active Directory environments; Tenable Web App Scanning, which provides scanning for modern web applications; Tenable Lumin Exposure View, a measurement tool; Tenable Attack Surface Management, an external attack surface management solution; Tenable Security Center, an on-premises solution that provides a risk-based view of an organization’s IT, security and compliance posture; and Tenable OT Security, an operational technology security solution which provides threat detection, asset tracking, vulnerability management, and configuration control capabilities. The company also offers Nessus, a vulnerability assessment solution for cybersecurity industry and enterprise platform; and Nessus Expert, that enables users to programmatically detect cloud infrastructure misconfigurations and vulnerabilities in the design and build phase. Tenable Holdings, Inc. was founded in 2002 and is headquartered in Columbia, Maryland.