Asana (NYSE:ASAN) versus StoneCo (NASDAQ:STNE) Critical Analysis

Asana (NYSE:ASAN) and StoneCo (NASDAQ:STNE) are both mid-cap 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 Asana and StoneCo, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Asana	5	7	4	1	2.06
StoneCo	2	1	8	1	2.67

Asana currently has a consensus price target of $16.10, indicating a potential upside of 12.60%. StoneCo has a consensus price target of $17.44, indicating a potential downside of 4.08%. Given Asana’s higher probable upside, equities analysts clearly believe Asana is more favorable than StoneCo.

Risk & Volatility

Asana has a beta of 1.11, meaning that its share price is 11% more volatile than the S&P 500. Comparatively, StoneCo has a beta of 1.99, meaning that its share price is 99% more volatile than the S&P 500.

Valuation & Earnings

This table compares Asana and StoneCo”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Asana	$723.88 million	4.67	-$255.54 million	($0.89)	-16.07
StoneCo	$2.46 billion	2.11	-$280.92 million	($0.70)	-25.97

Asana has higher earnings, but lower revenue than StoneCo. StoneCo is trading at a lower price-to-earnings ratio than Asana, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Asana and StoneCo’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Asana	-27.50%	-83.88%	-22.07%
StoneCo	-8.37%	18.71%	4.36%

Insider and Institutional Ownership

26.2% of Asana shares are held by institutional investors. Comparatively, 73.2% of StoneCo shares are held by institutional investors. 61.3% of Asana shares are held by company insiders. Comparatively, 11.3% of StoneCo 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

StoneCo beats Asana on 9 of the 14 factors compared between the two stocks.

About Asana

Asana, Inc., together with its subsidiaries, operates a work management platform for individuals, team leads, and executives in the United States and internationally. Its platform helps organizations to orchestrate work from daily tasks to cross-functional strategic initiatives; manage work across a portfolio of projects or workflows, see progress against goals, identify bottlenecks, resource constraints, and milestones; and communicate company-wide goals, monitor status, and oversee work across projects and portfolios to gain real-time insights. The company serves customers in various industries, such as technology, retail, education, non-profit, government, healthcare, hospitality, media, manufacturing, professional services, and financial services. The company was formerly known as Smiley Abstractions, Inc. and changed its name to Asana, Inc. in July 2009. Asana, Inc. was incorporated in 2008 and is headquartered in San Francisco, California.

About StoneCo

StoneCo Ltd. provides financial technology and software solutions to merchants and integrated partners to conduct electronic commerce across in-store, online, and mobile channels in Brazil. It distributes its solutions, principally through proprietary Stone Hubs, which offer hyper-local sales and services; and sells solutions to brick-and-mortar and digital merchants through sales team. The company served small-and-medium-sized businesses; and marketplaces, e-commerce platforms, and integrated software vendors. StoneCo Ltd. was founded in 2000 and is headquartered in George Town, the Cayman Islands.