Benefitfocus (NASDAQ: BNFT) and HubSpot (NYSE:HUBS) are both computer and technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their earnings, profitability, dividends, risk, valuation, analyst recommendations and institutional ownership.
Risk & Volatility
Benefitfocus has a beta of 0.99, indicating that its share price is 1% less volatile than the S&P 500. Comparatively, HubSpot has a beta of 2.24, indicating that its share price is 124% more volatile than the S&P 500.
This is a summary of recent ratings and price targets for Benefitfocus and HubSpot, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Benefitfocus presently has a consensus target price of $35.33, suggesting a potential upside of 40.77%. HubSpot has a consensus target price of $92.67, suggesting a potential downside of 16.70%. Given Benefitfocus’ higher possible upside, equities analysts clearly believe Benefitfocus is more favorable than HubSpot.
This table compares Benefitfocus and HubSpot’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Insider and Institutional Ownership
87.3% of Benefitfocus shares are held by institutional investors. Comparatively, 96.6% of HubSpot shares are held by institutional investors. 40.1% of Benefitfocus shares are held by company insiders. Comparatively, 12.1% of HubSpot shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Valuation & Earnings
This table compares Benefitfocus and HubSpot’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Benefitfocus||$233.34 million||3.36||-$40.05 million||($0.84)||-29.88|
|HubSpot||$375.61 million||11.21||-$39.71 million||$0.24||463.54|
HubSpot has higher revenue and earnings than Benefitfocus. Benefitfocus is trading at a lower price-to-earnings ratio than HubSpot, indicating that it is currently the more affordable of the two stocks.
HubSpot beats Benefitfocus on 10 of the 14 factors compared between the two stocks.
Benefitfocus Company Profile
Benefitfocus, Inc. (Benefitfocus) is a provider of cloud-based benefits management platform for consumers, employers, insurance carriers and brokers. The Benefitfocus Platform allows how organizations and individuals shop for, enroll in, manage and exchange benefits. The Company operates through two business segments: Employer, which derives its revenue from customers that use the Company’s services for the provision of benefits to their employees, and administrators acting on behalf of employers, Carrier, which derives its revenue from insurance companies that provide coverage at their own risk. Its solutions support benefits plans, including healthcare, dental, life and disability insurance, and voluntary benefits plans, such as critical illness, supplemental income and wellness programs. It provides a multi-tenant cloud-based benefits management platform to the employer and carrier markets.
HubSpot Company Profile
HubSpot, Inc. (HubSpot) provides a cloud-based marketing and sales software platform. The Company’s software platform features integrated applications to help businesses attract visitors to their Websites, convert visitors into leads, close leads into customers and delight customers so that they become promoters of those businesses. These integrated applications include social media, search engine optimization, blogging, Website content management, marketing automation, e-mail, sales productivity, customer relationship management (CRM), analytics and reporting. The Company’s products include HubSpot Marketing, HubSpot CRM and HubSpot Sales. The Company offers Professional Services and support. It offers professional services to educate and train customers on how to leverage its software platform and inbound marketing methodology to transform how their business attracts, engages and delights customers.
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