Contrasting Phunware (NASDAQ:PHUN) & Zoom Communications (NASDAQ:ZM)

Zoom Communications (NASDAQ:ZM) and Phunware (NASDAQ:PHUN) are both computer and technology companies, but which is the superior business? We will compare the two businesses based on the strength of their risk, valuation, profitability, analyst recommendations, earnings, institutional ownership and dividends.

Institutional and Insider Ownership

66.5% of Zoom Communications shares are owned by institutional investors. Comparatively, 7.6% of Phunware shares are owned by institutional investors. 11.5% of Zoom Communications shares are owned by insiders. Comparatively, 0.2% of Phunware shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Zoom Communications and Phunware, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Zoom Communications	1	13	14	0	2.46
Phunware	1	1	1	0	2.00

Zoom Communications currently has a consensus price target of $95.32, suggesting a potential upside of 24.71%. Phunware has a consensus price target of $6.33, suggesting a potential upside of 272.55%. Given Phunware’s higher probable upside, analysts clearly believe Phunware is more favorable than Zoom Communications.

Valuation and Earnings

This table compares Zoom Communications and Phunware”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Zoom Communications	$4.87 billion	4.65	$1.90 billion	$6.20	12.33
Phunware	$3.19 million	10.76	-$10.32 million	($0.52)	-3.27

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

Volatility and Risk

Zoom Communications has a beta of 0.93, indicating that its stock price is 7% less volatile than the S&P 500. Comparatively, Phunware has a beta of 2.64, indicating that its stock price is 164% more volatile than the S&P 500.

Profitability

This table compares Zoom Communications and Phunware’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Zoom Communications	39.03%	11.88%	9.68%
Phunware	-505.26%	-10.45%	-9.72%

Summary

Zoom Communications beats Phunware on 11 of the 14 factors compared between the two stocks.

About Zoom Communications

Zoom Video Communications, Inc. provides unified communications platform in the Americas, the Asia Pacific, Europe, the Middle East, and Africa. The company offers Zoom Meetings that offers HD video, voice, chat, and content sharing through mobile devices, desktops, laptops, telephones, and conference room systems; Zoom Phone, an enterprise cloud phone system; and Zoom Chat enables users to share messages, images, audio files, and content in desktop, laptop, tablet, and mobile devices. It also provides Zoom Rooms, a software-based conference room system; Zoom Conference Room Connector, a gateway for SIP/H.323 endpoints to join Zoom meetings; Zoom Events, which enables users to manage and host internal and external virtual events; OnZoom, a prosumer-focused virtual event platform and marketplace for Zoom users to create, host, and monetize online events; and Zoom Webinars to provide video presentations to large audiences from many devices. In addition, the company offers Zoom Developer Platform that enables developers, platform integrators, service providers, and customers to build apps and integrations using Zoom’s video-based communications solutions, as well as integrate Zoom’s technology into their products and services; Zoom App Marketplace, which helps developers to publish their apps, as well as third-party integrations of Zoom; and Zoom Contact Center, an omnichannel contact center solution. It serves individuals; and education, entertainment/media, enterprise infrastructure, finance, government, healthcare, manufacturing, non-profit/not for profit and social impact, retail/consumer products, and software/Internet industries. The company was formerly known as Zoom Communications, Inc. and changed its name to Zoom Video Communications, Inc. in May 2012. The company was incorporated in 2011 and is headquartered in San Jose, California.

About Phunware

Phunware, Inc., together with its subsidiaries, provides integrated software platform that equips companies with the products, solutions, and services to engage, manage, and monetize their mobile application portfolios in the United States and internationally. The company's products and services include mobile software and application transaction solutions comprise integration of software development kit (SDK) licenses, which consists of analytics that offers data related to application use and engagement; content management that allows application administrators to create and manage app content in a cloud-based portal; alerts, notifications, and messaging, which enables brands to send messages; marketing automation that enables location-triggered messages and workflow; advertising; and location-based services, such as mapping, navigation, wayfinding, workflow, asset management, and policy enforcement. It is also involved in the integration of its SDK licenses into existing applications maintained by its customers, as well as custom application development and support services; and provision of cloud-based vertical solutions for healthcare, retail, sports, aviation, real estate, hospitality, education, and other applications, as well as application transactions, including re-occurring and one-time transactional media purchases for application discovery, user acquisition and audience building, audience engagement, and audience monetization. Phunware, Inc. was founded in 2009 and is headquartered in Austin, Texas.