Crexendo (NASDAQ:CXDO – Get Free Report) and Zscaler (NASDAQ:ZS – Get Free Report) are both technology companies, but which is the better stock? We will compare the two companies based on the strength of their earnings, risk, analyst recommendations, profitability, institutional ownership, dividends and valuation.
Valuation & Earnings
This table compares Crexendo and Zscaler”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Crexendo | $68.17 million | 2.49 | $5.07 million | $0.12 | 42.38 |
| Zscaler | $3.35 billion | 9.63 | -$63.18 million | ($0.39) | -507.92 |
Crexendo has higher earnings, but lower revenue than Zscaler. Zscaler is trading at a lower price-to-earnings ratio than Crexendo, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Crexendo and Zscaler’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Crexendo | 4.48% | 14.40% | 11.36% |
| Zscaler | -1.88% | 1.23% | 0.40% |
Analyst Ratings
This is a breakdown of recent ratings and price targets for Crexendo and Zscaler, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Crexendo | 0 | 1 | 3 | 0 | 2.75 |
| Zscaler | 1 | 8 | 36 | 0 | 2.78 |
Crexendo presently has a consensus target price of $10.67, indicating a potential upside of 109.73%. Zscaler has a consensus target price of $236.65, indicating a potential upside of 19.47%. Given Crexendo’s higher probable upside, equities research analysts plainly believe Crexendo is more favorable than Zscaler.
Institutional and Insider Ownership
9.5% of Crexendo shares are held by institutional investors. Comparatively, 46.5% of Zscaler shares are held by institutional investors. 34.0% of Crexendo shares are held by company insiders. Comparatively, 17.2% of Zscaler shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
Risk & Volatility
Crexendo has a beta of 1.23, meaning that its share price is 23% more volatile than the S&P 500. Comparatively, Zscaler has a beta of 0.82, meaning that its share price is 18% less volatile than the S&P 500.
Summary
Crexendo beats Zscaler on 9 of the 14 factors compared between the two stocks.
About Crexendo
Crexendo, Inc. is a provider of cloud-based communications and technology services. The company offers unified communications as a service, business voice and messaging solutions, video conferencing, contact center capabilities, and related communications tools designed for small and medium-sized businesses, enterprises, and service providers. Crexendo also provides a communications software platform through its NetSapiens business. The platform supports hosted voice, unified communications, contact center, and application programming interface services, enabling telecommunications providers and channel partners to deliver branded communications solutions to their customers.
About Zscaler
Zscaler, Inc. is a cloud security company that provides services designed to help organizations protect users, applications, and data. Its platform, the Zscaler Zero Trust Exchange, connects users and devices to applications while applying security controls, rather than relying on traditional network boundaries. The company’s offerings include Zscaler Internet Access for securing internet and software-as-a-service traffic, and Zscaler Private Access for providing secure access to private applications.
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