Contrasting Arteris (NASDAQ:AIP) and Nextdoor (NYSE:KIND)

Arteris (NASDAQ:AIP) and Nextdoor (NYSE:KIND) are both small-cap computer and technology companies, but which is the superior stock? We will compare the two companies based on the strength of their analyst recommendations, valuation, dividends, institutional ownership, profitability, earnings and risk.

Institutional and Insider Ownership

64.4% of Arteris shares are owned by institutional investors. Comparatively, 35.7% of Nextdoor shares are owned by institutional investors. 29.1% of Arteris shares are owned by insiders. Comparatively, 33.4% of Nextdoor shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Volatility and Risk

Arteris has a beta of 1.93, suggesting that its share price is 93% more volatile than the S&P 500. Comparatively, Nextdoor has a beta of 1.19, suggesting that its share price is 19% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Arteris and Nextdoor, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Arteris	1	1	2	0	2.25
Nextdoor	0	1	0	0	2.00

Arteris presently has a consensus price target of $37.75, suggesting a potential upside of 0.92%. Nextdoor has a consensus price target of $2.00, suggesting a potential downside of 4.76%. Given Arteris’ stronger consensus rating and higher probable upside, equities research analysts plainly believe Arteris is more favorable than Nextdoor.

Earnings & Valuation

This table compares Arteris and Nextdoor”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Arteris	$70.58 million	24.43	-$34.75 million	($0.82)	-45.62
Nextdoor	$248.31 million	3.24	-$98.06 million	($0.24)	-8.75

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

Profitability

This table compares Arteris and Nextdoor’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Arteris	-44.92%	N/A	-27.79%
Nextdoor	-36.95%	-15.75%	-13.84%

Summary

Arteris beats Nextdoor on 8 of the 14 factors compared between the two stocks.

About Arteris

Arteris, Inc. provides semiconductor interconnect intellectual property (IP) and System-on-Chip (Soc) Integration Automation software solutions (SIA) in the Americas, the Asia Pacific, Europe, and the Middle East. The company develops, licenses, and supports the on-chip interconnect fabric technology used in Soc designs and Network-on-Chip (NoC) interconnect IP. Its products include FlexNoC and FlexWay silicon-proven interconnect IP products; Ncore, a silicon-proven and cache coherent interconnect IP product that provides scalable, configurable, and area efficient characteristics; and CodaCache, a last-level cache semiconductor IP product. The company also offers SIA products comprising Magillem Connectivity that shortens and streamlines the SoC integration process; and Magillem Registers and CSRCompiler that addresses hardware-software integration challenges for SoCs. The company serves semiconductor manufacturers, original equipment manufacturers, hyperscale system houses, semiconductor design houses, and other producers of electronic systems. Arteris, Inc. was founded in 2003 and is headquartered in Campbell, California.

About Nextdoor

Nextdoor Holdings, Inc. operates a neighborhood network that connects neighbors, businesses, and public services in the United States and internationally. The company enables neighbors and organizations to get information, give and get help, and build connections. It also offers advertising solutions, designs to generate value for businesses for connection and sales expansion. The company is headquartered in San Francisco, California.