Marketo (NASDAQ: MKTO) is one of 63 publicly-traded companies in the “Application Software” industry, but how does it contrast to its peers? We will compare Marketo to similar businesses based on the strength of its dividends, institutional ownership, profitability, analyst recommendations, earnings, risk and valuation.

Institutional and Insider Ownership

70.7% of shares of all “Application Software” companies are held by institutional investors. 16.0% of shares of all “Application Software” companies are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Risk & Volatility

Marketo has a beta of 1.1, indicating that its stock price is 10% more volatile than the S&P 500. Comparatively, Marketo’s peers have a beta of 1.68, indicating that their average stock price is 68% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and target prices for Marketo and its peers, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Marketo 0 0 0 0 N/A
Marketo Competitors 230 1670 2861 109 2.59

As a group, “Application Software” companies have a potential upside of 10.42%. Given Marketo’s peers higher possible upside, analysts clearly believe Marketo has less favorable growth aspects than its peers.

Profitability

This table compares Marketo and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Marketo -23.20% -98.33% -27.18%
Marketo Competitors -61.22% -92.97% -15.96%

Earnings and Valuation

This table compares Marketo and its peers revenue, earnings per share and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Marketo N/A N/A -20.34
Marketo Competitors $769.36 million $137.09 million -10.55

Marketo’s peers have higher revenue and earnings than Marketo. Marketo is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Summary

Marketo peers beat Marketo on 7 of the 8 factors compared.

About Marketo

Marketo, Inc. is a United States-based provider of a cloud-based Engagement Marketing software platform, which enables organizations to involve in engagement marketing. The Company’s platform offers a range applications across various categories, including Marketing Automation, which helps to organize personalized multi-channel marketing campaigns and workflows; Email Marketing, which provides the ability to tap the insights captured in the Audience Hub to send e-mail messages; Mobile Engagement, which engages customers on their mobile devices; Digital Ads, which allows marketers to focus on behavioral data captured in the Audience Hub for personalized digital advertisements; Web Personalization, which helps in personalizing experiences to engage people; Marketing Analytics; Predictive Content, which discovers Website assets, such as e-books and case studies; Marketing Calendar, and Sales Insight. It offers solutions, such as Lead Management solution and Consumer Marketing solution.

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