SciQuest (NASDAQ: SQI) and Top Image Systems (NASDAQ:TISA) are both small-cap software – nec companies, but which is the better business? We will compare the two companies based on the strength of their risk, institutional ownership, valuation, dividends, analyst recommendations, profitability and earnings.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for SciQuest and Top Image Systems, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
SciQuest 0 0 0 0 N/A
Top Image Systems 0 1 2 0 2.67

Top Image Systems has a consensus price target of $2.50, suggesting a potential upside of 117.39%. Given Top Image Systems’ higher probable upside, analysts clearly believe Top Image Systems is more favorable than SciQuest.

Profitability

This table compares SciQuest and Top Image Systems’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
SciQuest 3.93% 2.23% 1.59%
Top Image Systems -30.77% -50.20% -24.46%

Risk and Volatility

SciQuest has a beta of 1.24, suggesting that its share price is 24% more volatile than the S&P 500. Comparatively, Top Image Systems has a beta of 1.18, suggesting that its share price is 18% more volatile than the S&P 500.

Valuation & Earnings

This table compares SciQuest and Top Image Systems’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
SciQuest N/A N/A N/A $0.11 161.36
Top Image Systems $31.64 million 0.65 -$6.61 million ($0.49) -2.35

SciQuest has higher earnings, but lower revenue than Top Image Systems. Top Image Systems is trading at a lower price-to-earnings ratio than SciQuest, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

5.4% of Top Image Systems shares are held by institutional investors. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Summary

SciQuest beats Top Image Systems on 6 of the 10 factors compared between the two stocks.

About SciQuest

SciQuest, Inc. is a United States-based public provider of spend management solutions. The Company’s offers a range of solutions, such as Spend Director, Spend Radar, Sourcing Director, Advanced Sourcing Optimizer, Total Contract Manager, Total Supplier Manager, Enterprise Reagent Manager, Accounts Payable Director, Supplier Network and Portfolio Savings Manager. Its Spend Director is an e-procurement software, which allows users’ to integrate and automate processes, suppliers, compliance and workflows. Its Portfolio Savings Manager is a cloud-based savings management software that integrates project forecasting, initiative approval workflows and real-time savings. Its chemical inventory management software, Enterprise Reagent Manager (ERM), allows scientific staff in the organization to find, source and track commercial and proprietary chemicals, reagents and lab supplies. Its Total Contract Manager is a Contract Lifecycle Management solution that offers real-time updates.

About Top Image Systems

Top Image Systems Ltd. (TIS) is a developer and marketer of intelligent content capture and workflow automation solutions for managing and validating incoming content in any format from any source. The Company’s solutions deliver digital content to the people and applications that drive an enterprise by using advanced network, mobile and cloud technologies. Its products integrate information regardless of the source and format of the data, whether structured, as in the case of application forms or surveys, or semi-structured, such as invoices, purchase orders, checks, freight and shipping bills, and others or unstructured. Its software minimizes the need for manual data entry by automatically capturing, reading, understanding, identifying, processing, classifying and routing the information contained in documents. Its mobiFLOW software development kit (SDK) is a multi-purpose mobile capture and processing platform that enables capture of any document of any size using a mobile device.

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