Red Violet (NASDAQ:RDVT) and Twilio (NYSE:TWLO) are both computer and technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, profitability, valuation, dividends, earnings, institutional ownership and analyst recommendations.

Earnings & Valuation

This table compares Red Violet and Twilio’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Red Violet $16.30 million 15.33 -$6.87 million N/A N/A
Twilio $650.07 million 25.61 -$121.95 million ($0.80) -151.76

Red Violet has higher earnings, but lower revenue than Twilio.

Analyst Recommendations

This is a summary of current ratings for Red Violet and Twilio, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Red Violet 0 0 0 0 N/A
Twilio 0 2 18 0 2.90

Twilio has a consensus target price of $138.81, suggesting a potential upside of 14.33%. Given Twilio’s higher possible upside, analysts plainly believe Twilio is more favorable than Red Violet.

Profitability

This table compares Red Violet and Twilio’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Red Violet -31.83% -15.74% -13.54%
Twilio -26.20% -6.02% -4.84%

Risk and Volatility

Red Violet has a beta of 0.03, meaning that its stock price is 97% less volatile than the S&P 500. Comparatively, Twilio has a beta of 1.1, meaning that its stock price is 10% more volatile than the S&P 500.

Institutional & Insider Ownership

15.8% of Red Violet shares are held by institutional investors. Comparatively, 80.9% of Twilio shares are held by institutional investors. 4.3% of Red Violet shares are held by insiders. Comparatively, 10.9% of Twilio shares are held by 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.

Summary

Twilio beats Red Violet on 10 of the 12 factors compared between the two stocks.

About Red Violet

Red Violet, Inc., a software and services company, specializes in big data analysis providing cloud-based mission-critical information solutions to enterprises in various industries in the United States. Its proprietary platform includes CORE, a cloud-based technology platform, which serves various industries within risk management. The company serves various industries, including law enforcement, government, financial services, insurance, and corporate risk for identity verification, risk assessment, fraud detection, and compliance. It markets its products and services through value-added distributors, resellers, and strategic partners; and trade shows and seminars, advertising, public relations, distribution of sales literature, and product specifications and ongoing communication with prospective clients, distributors, resellers, strategic partners, and installed base of current clients, as well as through direct sales. The company was incorporated in 2017 and is headquartered in Boca Raton, Florida.

About Twilio

Twilio Inc. provides a cloud communications platform that enables developers to build, scale, and operate communications within software applications in the United States and internationally. The company's programmable communications cloud provides a set of application programming interfaces that enable developers to embed voice, messaging, and video capabilities into their applications. Twilio Inc. was founded in 2008 and is headquartered in San Francisco, California.

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