GRIDSUM HOLDING (NASDAQ: GSUM) and MINDBODY (NASDAQ:MB) are both small-cap computer and technology companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, earnings, risk, institutional ownership, valuation, analyst recommendations and dividends.

Profitability

This table compares GRIDSUM HOLDING and MINDBODY’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
GRIDSUM HOLDING -26.87% -16.80% -10.15%
MINDBODY -9.26% -9.70% -7.52%

Analyst Ratings

This is a breakdown of recent recommendations and price targets for GRIDSUM HOLDING and MINDBODY, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
GRIDSUM HOLDING 0 0 0 0 N/A
MINDBODY 0 2 7 0 2.78

MINDBODY has a consensus target price of $31.06, suggesting a potential downside of 3.70%. Given MINDBODY’s higher probable upside, analysts plainly believe MINDBODY is more favorable than GRIDSUM HOLDING.

Institutional and Insider Ownership

30.4% of GRIDSUM HOLDING shares are held by institutional investors. Comparatively, 84.7% of MINDBODY shares are held by institutional investors. 8.2% of MINDBODY shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares GRIDSUM HOLDING and MINDBODY’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
GRIDSUM HOLDING N/A N/A N/A ($0.90) -9.61
MINDBODY $159.77 million 9.36 -$8.80 million ($0.38) -84.87

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

Summary

MINDBODY beats GRIDSUM HOLDING on 9 of the 9 factors compared between the two stocks.

About GRIDSUM HOLDING

Gridsum Holding Inc. is a holding company. The Company provides data analysis software for multinational and domestic enterprises, and government agencies in China. The Company’s technology, the Gridsum Big Data Platform performs multi-dimensional correlation analysis and analyzes real-time events. The Company offers various types of solutions and technologies. The Company’s software products are designed for a range of commercial and governmental applications. The Company’s products focus on digital marketing analytics and automation solutions. The Company offers Web analytics solutions based on data warehouse technology to build solutions on a distributed data warehouse architecture, using the open-source Hadoop framework. The Company delivers its solutions as cloud-based software-as-a-service (SaaS) offerings that manage information technology (IT) support costs by outsourcing hardware and software maintenance and support.

About MINDBODY

MINDBODY, Inc. is a provider of cloud-based business management software for the wellness services industry and operates as a consumer marketplace with local business subscribers on its platform. The Company’s subscribers provide a range of wellness services to active consumers. Its integrated software and payments platform helps business owners in the wellness services industry run, market and build their businesses. It also helps consumers discover, evaluate, engage and transact with these businesses through the Web and mobile devices. The platform addresses various aspects of operating a wellness business, including client scheduling and online booking; retail point-of-sale; analytics and reporting; user experience; mobility; social integration; dynamic cloud-based architecture; open platform for third-party application development; integration with other cloud-based partners, and security and compliance.

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