New Relic (NYSE: NEWR) and Workiva (NYSE:WK) are both computer and technology companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, risk, earnings, institutional ownership, analyst recommendations and valuation.

Earnings & Valuation

This table compares New Relic and Workiva’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
New Relic $263.48 million 15.77 -$61.07 million ($1.10) -68.14
Workiva $207.87 million 4.91 -$44.42 million ($1.07) -22.43

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

Institutional and Insider Ownership

75.8% of New Relic shares are owned by institutional investors. Comparatively, 40.4% of Workiva shares are owned by institutional investors. 23.1% of New Relic shares are owned by company insiders. Comparatively, 33.3% of Workiva shares are owned 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.

Analyst Ratings

This is a summary of current ratings and recommmendations for New Relic and Workiva, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
New Relic 0 5 8 0 2.62
Workiva 0 5 3 0 2.38

New Relic presently has a consensus price target of $65.38, suggesting a potential downside of 12.76%. Workiva has a consensus price target of $23.83, suggesting a potential downside of 0.69%. Given Workiva’s higher possible upside, analysts plainly believe Workiva is more favorable than New Relic.

Profitability

This table compares New Relic and Workiva’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
New Relic -16.17% -25.22% -13.61%
Workiva -21.37% N/A -29.26%

Risk & Volatility

New Relic has a beta of 0.64, meaning that its share price is 36% less volatile than the S&P 500. Comparatively, Workiva has a beta of 0.54, meaning that its share price is 46% less volatile than the S&P 500.

Summary

New Relic beats Workiva on 8 of the 14 factors compared between the two stocks.

New Relic Company Profile

New Relic, Inc., a software-as-a-service company, provides digital intelligence products worldwide. The company's cloud-based platform and suite of products include New Relic Digital Intelligence Platform, which enables organizations to collect, store, and analyze data. It provides New Relic Application Performance Management that offers visibility into the performance and usage of server-based applications, such as data pertaining to response time, transaction throughput, error rates, transactions, and user satisfaction; New Relic Mobile, which provides code-level visibility into the performance of mobile applications running on the iOS and Android mobile operating systems; and New Relic Browser, a product that monitors the page view experiences of actual end-users for desktop and mobile browser-based applications. The company also offers New Relic Synthetics, which simulates usage and reproduces business-critical functionality that enables its users to test their software throughout the development life cycle; and New Relic Infrastructure that provides information technology operation teams with the visibility into the health performance of their infrastructure. In addition, it provides New Relic Insights that enables technology and business users to perform real-time analysis; New Relic Alerts, a centralized notification system for managing alert policies and alert conditions; New Relic Plugins, which offers a plugin architecture, including application programming interfaces and software development kits for customers and partners to embed and extend its solution into their products; and real-time dashboards for tracking business metrics from a set of application sources, as well as live-state server configuration monitoring across cloud infrastructure. The company sells its products through direct sales organizations, online and offline sales, and marketing activities. New Relic, Inc. was founded in 2007 and is headquartered in San Francisco, California.

Workiva Company Profile

Workiva Inc. provides cloud solutions for the finance and accounting, audit and internal controls, risk and compliance, and performance and management reporting markets in the United States and internationally. The company provides Wdesk, a platform with proprietary word processing, spreadsheet, and presentation applications to collect, link, report, and analyze the business data, as well as to create, review, and publish data-linked documents and reports. As of December 31, 2017, it had subscriptions from 3,063 enterprises, including various Fortune 500 companies. The company was founded in 2008 and is headquartered in Ames, Iowa.

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