Care.com (NYSE: CRCM) and Tucows (NASDAQ:TCX) are both small-cap technology companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, profitability, institutional ownership, earnings, valuation, dividends and analyst recommendations.
Risk and Volatility
Care.com has a beta of 0.98, suggesting that its stock price is 2% less volatile than the S&P 500. Comparatively, Tucows has a beta of 0.63, suggesting that its stock price is 37% less volatile than the S&P 500.
This is a summary of recent ratings and price targets for Care.com and Tucows, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Care.com currently has a consensus price target of $18.00, suggesting a potential downside of 3.79%. Given Care.com’s higher probable upside, research analysts clearly believe Care.com is more favorable than Tucows.
This table compares Care.com and Tucows’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Valuation & Earnings
This table compares Care.com and Tucows’ top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Care.com||$174.09 million||3.28||$10.66 million||$0.21||89.10|
|Tucows||$329.42 million||1.92||$22.32 million||$1.14||52.28|
Tucows has higher revenue and earnings than Care.com. Tucows is trading at a lower price-to-earnings ratio than Care.com, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
72.6% of Care.com shares are owned by institutional investors. Comparatively, 52.8% of Tucows shares are owned by institutional investors. 35.9% of Care.com shares are owned by insiders. Comparatively, 13.2% of Tucows shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Care.com beats Tucows on 8 of the 13 factors compared between the two stocks.
Care.com Company Profile
Care.com, Inc. is an online marketplace for finding and managing family care. As of December 31, 2016, the Company had 22.8 million members, including 12.9 million families and 9.9 million caregivers, spanning 19 countries. Its consumer matching solutions allow families to search for, qualify, vet, connect with and select caregivers. It also provides caregivers with solutions to create personal profiles, describe their skills and experience, and otherwise differentiate and market themselves in a fragmented marketplace. In addition to consumer matching solutions, the Company offers its members products and services to facilitate their interaction with caregivers. It serves employers by providing access to certain of its products and services to employer-sponsored families. In addition, it serves care-related businesses, such as day care centers, nanny agencies and home care agencies, willing to market their services to its care-seeking families and recruit its caregiver members.
Tucows Company Profile
Tucows Inc. is engaged in providing Internet services. The Company’s segments include Network Access Services and Domain Services. The Network Access Services segment includes mobile, fixed high-speed Internet access services, Internet hosting and network consulting services. The Domain Services segment wholesale and retail domain name registration services, value added services and portfolio services. The Company focuses on serving the needs of this network of resellers by providing services, interfaces, proactive and attentive customer service, reseller-oriented technology and agile design and development processes. The Company focuses its service offerings under brands, including OpenSRS, YummyNames, Platypus, Hover and Ting. As of December 31, 2016, the OpenSRS Domain Service managed 15 million domain names under the Tucows ICANN registrar accreditation and for other registrars. As of December 31, 2016, Ting managed mobile telephony services for approximately 151,000 subscribers.
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