Digital Turbine (NASDAQ: APPS) and SciQuest (NASDAQ:SQI) are both small-cap computer and technology companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, institutional ownership, risk, analyst recommendations, valuation, dividends and profitability.

Analyst Ratings

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This is a summary of current ratings and price targets for Digital Turbine and SciQuest, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Digital Turbine 0 0 4 0 3.00
SciQuest 0 0 0 0 N/A

Digital Turbine presently has a consensus target price of $1.83, suggesting a potential downside of 26.71%. Given Digital Turbine’s higher possible upside, equities research analysts clearly believe Digital Turbine is more favorable than SciQuest.

Earnings and Valuation

This table compares Digital Turbine and SciQuest’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Digital Turbine $91.55 million 2.04 -$24.26 million ($0.31) -8.03
SciQuest N/A N/A N/A $0.11 161.36

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

Profitability

This table compares Digital Turbine and SciQuest’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Digital Turbine -18.66% -22.65% -11.95%
SciQuest 3.93% 2.23% 1.59%

Risk and Volatility

Digital Turbine has a beta of 1.33, meaning that its share price is 33% more volatile than the S&P 500. Comparatively, SciQuest has a beta of 1.24, meaning that its share price is 24% more volatile than the S&P 500.

Institutional and Insider Ownership

22.6% of Digital Turbine shares are held by institutional investors. 5.8% of Digital Turbine shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Summary

Digital Turbine beats SciQuest on 6 of the 10 factors compared between the two stocks.

About Digital Turbine

Digital Turbine, Inc. is engaged in delivering end-to-end products and solutions for mobile operators, application advertisers, device original equipment manufacturers (OEMs) and other third parties to enable them to monetize mobile content. The Company operates its business in two operating segments: Advertising and Content. The Advertising segment consists of two businesses: Operator and OEM (O&O) and Advertiser and Publisher (A&P). The O&O business is an advertiser solution for carrier and OEM inventory consisting of services, such as Ignite, a mobile device management platform and Discover, an intelligent application discovery platform. Its A&P business is a mobile user acquisition network across the world consisting of services, such as syndicated network and real time bidding (RTB). The Content segment consists of services, including Marketplace, which is an application and content store, and Pay, which is a content management and mobile payment solution.

About SciQuest

JAGGAER 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.

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