Actua (NASDAQ: ACTA) and AgroFresh Solutions (NASDAQ:AGFS) are both small-cap computer and technology companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, valuation, analyst recommendations, risk, earnings, dividends and institutional ownership.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Actua and AgroFresh Solutions, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Actua 0 1 0 0 2.00
AgroFresh Solutions 0 1 0 0 2.00

Actua currently has a consensus target price of $17.00, suggesting a potential upside of 8.97%. AgroFresh Solutions has a consensus target price of $8.00, suggesting a potential upside of 11.73%. Given AgroFresh Solutions’ higher probable upside, analysts plainly believe AgroFresh Solutions is more favorable than Actua.

Earnings & Valuation

This table compares Actua and AgroFresh Solutions’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Actua $109.30 million 4.67 $70.08 million $2.21 7.06
AgroFresh Solutions $159.67 million 2.26 -$111.56 million ($1.40) -5.11

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

Risk & Volatility

Actua has a beta of 1.67, meaning that its share price is 67% more volatile than the S&P 500. Comparatively, AgroFresh Solutions has a beta of 0.89, meaning that its share price is 11% less volatile than the S&P 500.

Insider and Institutional Ownership

72.5% of Actua shares are held by institutional investors. Comparatively, 72.6% of AgroFresh Solutions shares are held by institutional investors. 10.2% of Actua shares are held by company insiders. Comparatively, 15.2% of AgroFresh Solutions shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Actua and AgroFresh Solutions’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Actua 67.78% -5.80% -4.62%
AgroFresh Solutions -42.54% 0.19% 0.07%

Summary

AgroFresh Solutions beats Actua on 6 of the 11 factors compared between the two stocks.

About Actua

Actua Corporation, formerly ICG Group, Inc., is a multi-vertical cloud technology company. The Company operates through two segments, which include the vertical cloud segment and the vertical cloud (venture) segment. The Company’s vertical cloud-based businesses include Bolt Solutions Inc. (Bolt), Folio Dynamics Holdings Inc. (FolioDynamix), GovDelivery Holdings, Inc. (GovDelivery) and VelocityEHS Holdings, Inc. (VelocityEHS), which operate in the commercial and personal property and casualty insurance, wealth management, government communications and environmental, health and safety (EH&S) markets, respectively. The vertical cloud (venture) businesses include InstaMed Holdings, Inc. (InstaMed) and Parchment Inc. (Parchment), which operate a cloud-based healthcare payments network and an education credentials technology, respectively.

About AgroFresh Solutions

AgroFresh Solutions, Inc., formerly Boulevard Acquisition Corp., is a developer of agricultural technologies that preserve the freshness and value of fresh produce, including apples, pears, kiwifruit, avocados and bananas, as well as flowers. The Company’s principal product, The SmartFresh Quality System (SmartFresh), regulates the post-harvest ripening effects of ethylene, the naturally occurring plant hormone that triggers ripening in certain fruits and vegetables, through technology. SmartFresh is naturally biodegradable and leaves no detectable residue, which has significant consumer appeal. SmartFresh allows growers and packers to deliver just harvested freshness on a year-round basis. An integral part of the SmartFresh sales process is the AgroFresh Whole Product offering, which is a direct service model that provides customers with on-site applications of SmartFresh at their storage facilities combined with advisory services. The Company operates in approximately 40 countries.

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