Determine (NASDAQ: DTRM) and Callidus Software (NASDAQ:CALD) are both small-cap technology companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, earnings, analyst recommendations, valuation, profitability and risk.

Institutional and Insider Ownership

23.3% of Determine shares are held by institutional investors. Comparatively, 94.8% of Callidus Software shares are held by institutional investors. 10.0% of Determine shares are held by insiders. Comparatively, 1.6% of Callidus Software shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of recent ratings and target prices for Determine and Callidus Software, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Determine 0 0 2 0 3.00
Callidus Software 0 1 8 0 2.89

Determine currently has a consensus price target of $4.00, indicating a potential upside of 87.79%. Callidus Software has a consensus price target of $26.57, indicating a potential upside of 3.59%. Given Determine’s stronger consensus rating and higher possible upside, analysts clearly believe Determine is more favorable than Callidus Software.

Earnings & Valuation

This table compares Determine and Callidus Software’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Determine $27.96 million 1.11 -$5.40 million ($0.77) -2.77
Callidus Software $227.99 million 7.61 -$7.84 million ($0.37) -69.32

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

Risk & Volatility

Determine has a beta of 1.85, indicating that its share price is 85% more volatile than the S&P 500. Comparatively, Callidus Software has a beta of 0.87, indicating that its share price is 13% less volatile than the S&P 500.

Profitability

This table compares Determine and Callidus Software’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Determine -39.81% -113.35% -19.07%
Callidus Software -10.08% -6.25% -3.79%

Summary

Callidus Software beats Determine on 8 of the 13 factors compared between the two stocks.

About Determine

Determine, Inc., (Determine), formerly Selectica, Inc., is a provider of enterprise contract management, supply management and configuration solutions. The Company is engaged in providing software as a service (SaaS) Source to Pay and Enterprise Contract Lifecyclem Management (ECLM) solutions. Its Source to Pay software suite includes strategic sourcing, supplier management, contract management and procure-to-pay applications. The Determine Cloud Platform gives procurement, finance and legal professionals the ability to deliver insights through analysis of their supplier relationships and contractual requirements. The Determine platform is an open technology infrastructure based on smart process application models. In addition to its source to pay and enterprise contract lifecycle management solutions suite, Determine also provides a configuration engine solution. The Company’s Configuration engine consolidates the management and dissemination of complex product information.

About Callidus Software

Callidus Software Inc. (Callidus) is a provider of cloud-based sales, marketing, learning and customer experience solutions. The Company’s CallidusCloud enables its customers to manage their Lead to Money process with a suite of solutions that identify leads, implement territory and quota plans, enable sales forces, automate bid configuration pricing and quoting, manage contracts, streamline sales compensation and capture customer feedback, among others. Lead to Money is a process designed to help companies respond to the changing role of sales and marketing in the redefined buying cycle. The company’s Lead to Money suite and technology solutions include Lead, Planning, Enablement, Quotes and Proposals, Contracts, Incentives, Customer Experience and Technology. The Company provides a range of services to its customers, which include professional services, business process outsourcing services, maintenance and technical support services, and education services.

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