Bridgeline Digital (NASDAQ: BLIN) and Hortonworks (NASDAQ:HDP) are both small-cap computer and technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, earnings, valuation, institutional ownership, risk and dividends.

Profitability

This table compares Bridgeline Digital and Hortonworks’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Bridgeline Digital -29.84% -9.85% -6.42%
Hortonworks -89.35% -765.37% -94.91%

Earnings and Valuation

This table compares Bridgeline Digital and Hortonworks’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Bridgeline Digital $15.90 million 0.70 -$7.82 million ($1.35) -1.96
Hortonworks $184.46 million 7.44 -$251.68 million ($3.37) -5.78

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

Institutional & Insider Ownership

33.6% of Bridgeline Digital shares are held by institutional investors. Comparatively, 48.0% of Hortonworks shares are held by institutional investors. 33.8% of Bridgeline Digital shares are held by insiders. Comparatively, 22.5% of Hortonworks shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of current recommendations and price targets for Bridgeline Digital and Hortonworks, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Bridgeline Digital 0 0 0 0 N/A
Hortonworks 0 3 11 0 2.79

Hortonworks has a consensus target price of $20.42, suggesting a potential upside of 4.86%. Given Hortonworks’ higher probable upside, analysts clearly believe Hortonworks is more favorable than Bridgeline Digital.

Summary

Bridgeline Digital beats Hortonworks on 6 of the 11 factors compared between the two stocks.

About Bridgeline Digital

Bridgeline Digital, Inc. is a digital engagement company. The Company’s iAPPS platform is a Web Engagement Management (WEM) platform that integrates Web Content Management, e-commerce, e-marketing, Social Media management and Web Analytics to help marketers deliver digital experiences that engage and convert their customers across all channels. The iAPPS platform is delivered through a cloud-based Software as a Service (SaaS) multi-tenant business model, which provides customers with deployment providing maintenance, daily technical operation and support, or through a perpetual licensing business model. The iAPPS suite of products includes iAPPS Experience Manager, iAPPS Content Manager, iAPPS Commerce, iAPPS Marketier, iAPPS Analyzer, iAPPSds and iAPPS Social. It offers various services, such as digital engagement services, digital strategy services, usability design and information architecture. It provides shared hosting, dedicated hosting and SaaS hosting for its customers.

About Hortonworks

Hortonworks, Inc. is a provider and distributor of enterprise-scale data management software platforms. The Company’s product offerings include Hortonworks Data Platform (HDP), Hortonworks Sandbox and Hortonworks DataFlow Platform (HDF). It provides support subscription offerings and related professional services for its enterprise-scale Connected Data Platforms, such as HDP and HDF. Its Data at Rest solution, the HDP, is an enterprise-scale data management platform built entirely on open source software, including Apache Hadoop. HDP combines computer servers with local storage and open source software technology to create a distributed compute and storage platform for data sets that is secure and scalable over petabytes of data within thousands of servers or nodes. Its Data in Motion solution, the HDF, is an enterprise-scale data ingest platform built entirely on open source software, including Apache NiFi.

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