Contrasting Instructure (NYSE:INST) and Electronic Arts (NYSE:EA)

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Instructure (NYSE:INST) and Electronic Arts (NASDAQ:EA) are both computer and technology companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, profitability, valuation, earnings, risk and dividends.

Analyst Ratings

This is a summary of current ratings and recommmendations for Instructure and Electronic Arts, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Instructure 0 5 6 0 2.55
Electronic Arts 0 9 20 0 2.69

Instructure currently has a consensus price target of $47.97, indicating a potential upside of 21.84%. Electronic Arts has a consensus price target of $111.07, indicating a potential upside of 12.79%. Given Instructure’s higher probable upside, equities analysts clearly believe Instructure is more favorable than Electronic Arts.

Risk & Volatility

Instructure has a beta of 0.45, meaning that its share price is 55% less volatile than the S&P 500. Comparatively, Electronic Arts has a beta of 0.97, meaning that its share price is 3% less volatile than the S&P 500.

Earnings & Valuation

This table compares Instructure and Electronic Arts’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Instructure $209.54 million 6.97 -$43.46 million ($1.23) -32.01
Electronic Arts $4.95 billion 5.86 $1.02 billion $3.93 25.06

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

Profitability

This table compares Instructure and Electronic Arts’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Instructure -24.07% -41.15% -17.99%
Electronic Arts 42.75% 19.63% 12.25%

Insider and Institutional Ownership

91.4% of Instructure shares are held by institutional investors. Comparatively, 92.7% of Electronic Arts shares are held by institutional investors. 9.6% of Instructure shares are held by company insiders. Comparatively, 2.2% of Electronic Arts shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Summary

Electronic Arts beats Instructure on 11 of the 14 factors compared between the two stocks.

About Instructure

Instructure, Inc. provides applications for learning, assessment, and performance management through a software-as-a-service business model worldwide. It develops Canvas, a learning management platform for KÂ?12 and higher education; and Bridge, an employee development and engagement platform. The company's applications enhance academic and corporate learning by providing a system of engagement for teachers and learners, enabling frequent and open interactions, a streamlined workflow, and the creation and sharing of content with anytime, anywhere access to information. Its platform also provides data analytics that enable real-time reaction to information and benchmarking in order to personalize curricula and goal setting; and enhance the efficacy of the learning, assessment, and performance management processes. The company was founded in 2008 and is headquartered in Salt Lake City, Utah.

About Electronic Arts

Electronic Arts Inc. develops, markets, publishes, and distributes games, content, and services for game consoles, PCs, mobile phones, and tablets worldwide. The company develops and publishes games and services across various genres, such as sports, first-person shooter, action, role-playing, and simulation primarily under the Battlefield, Mass Effect, Need for Speed, The Sims, and Plants v. Zombies brands; and license games from others, such as FIFA, Madden NFL, and Star Wars. It also provides advertisement services on its online Web pages and games; and licenses its game software to third parties. The company markets and sells its games and services through digital distribution channels, as well as through retail channels, such as mass market retailers, electronics specialty stores, and game software specialty stores. Electronic Arts Inc. was founded in 1982 and is headquartered in Redwood City, California.

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