Akamai Technologies (NASDAQ:AKAM) versus LivePerson (NASDAQ:LPSN) Financial Analysis

Akamai Technologies (NASDAQ:AKAM) and LivePerson (NASDAQ:LPSN) 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, risk, profitability, dividends, valuation and earnings.

Insider & Institutional Ownership

94.3% of Akamai Technologies shares are held by institutional investors. Comparatively, 79.8% of LivePerson shares are held by institutional investors. 2.0% of Akamai Technologies shares are held by company insiders. Comparatively, 2.0% of LivePerson shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Akamai Technologies and LivePerson’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Akamai Technologies	10.74%	13.86%	6.07%
LivePerson	-51.72%	N/A	-7.71%

Analyst Recommendations

This is a summary of recent ratings for Akamai Technologies and LivePerson, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Akamai Technologies	2	9	10	0	2.38
LivePerson	1	1	0	0	1.50

Akamai Technologies presently has a consensus target price of $108.84, suggesting a potential upside of 6.59%. Given Akamai Technologies’ stronger consensus rating and higher possible upside, analysts plainly believe Akamai Technologies is more favorable than LivePerson.

Earnings & Valuation

This table compares Akamai Technologies and LivePerson”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Akamai Technologies	$4.21 billion	3.52	$452.03 million	$3.08	33.15
LivePerson	$312.47 million	0.11	-$134.27 million	($27.95)	-0.11

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

Volatility and Risk

Akamai Technologies has a beta of 0.72, meaning that its share price is 28% less volatile than the S&P 500. Comparatively, LivePerson has a beta of 1.42, meaning that its share price is 42% more volatile than the S&P 500.

Summary

Akamai Technologies beats LivePerson on 12 of the 13 factors compared between the two stocks.

About Akamai Technologies

Akamai Technologies, Inc. provides cloud computing, security, and content delivery services in the United States and internationally. The company offers cloud solutions to keep infrastructure, websites, applications, application programming interfaces, and users safe from various cyberattacks and online threats while enhancing performance. It also provides web and mobile performance solutions to enable dynamic websites and applications; media delivery solutions, including video streaming and video player services, game and software delivery, broadcast operations, authoritative domain name system, resolution, and data and analytics; and cloud computing services, such as compute, storage, networking, database, and container management services to build, deploy, and secure applications and workloads. In addition, the company offers content delivery solutions; and an array of service and support to assist customers with integrating, configuring, optimizing, and managing its offerings. It sells its solutions through various channel partners. Akamai Technologies, Inc. was incorporated in 1998 and is headquartered in Cambridge, Massachusetts.

About LivePerson

LivePerson, Inc. engages in conversational artificial intelligence. It enables brands to leverage the Conversational Cloud's intelligence engine to connect with consumers through an integrated suite of mobile and online business messaging technologies. The company offers the Conversational Cloud, an enterprise-class digital customer conversation platform, which enables businesses and consumers to connect through conversational channels, such as voice, in-app, and mobile messaging. It also provides professional services; LivePerson's Conversational AI, including conversation builder, manager, and intelligence, and intent manager. In addition, it provides Voice AI, conversational intelligence and insights, and integration services. The company sells its products to Fortune 500 companies, Internet businesses, online merchants, automotive dealers, educational institution, public sector, and not-for-profit organizations. It operates in the United States, Canada, Latin America, South America, Europe, the Middle East, Africa, the United Kingdom, and the Asia-Pacific. LivePerson, Inc. was incorporated in 1995 and is headquartered in New York, New York.